European equities and US futures were buoyant Friday as markets attempt a bounce into the weekend after a truly history week.
Asian equities were lower, but some gauges pared their worst losses after a harrowing start characterized by a series of circuit breakers in South Korea, the Philippines and other locales, as local markets tried to catch down to Thursday’s “worst since 1987” session on Wall Street.
Trading was halted in Seoul, Bangkok, Manila, Jakarta and Mumbai, as stocks careened lower. And yet, by the time the dust settled, record turnarounds were in the books. Have a look, for example, at Thailand’s SET:
What you see in the top pane is a swing from a 13% selloff to a 0.3% gain by the end of the session – that’s quite something. In the bottom pane is Australian equities. Down under, things were bad to the tune of a near 8% decline. And yet, by the end of the day, shares were higher by more than 4%. It was the largest intraday swing since the index was established in 2000.
There was quite a bit of confusion as to exactly what went on, but the RBA added a net A$6.91 billion in liquidity, offering A$8.8 billion in its OMO, versus an originally intended A$3.7 billion. With only A$1.925 billion rolling off, the net injection was large. Other traders pointed to Prime Minister Scott Morrison holding off on more draconian measures to fight the spread of the virus.
Ultimately, Australian stocks had their best day since 2008 after nearly suffering their worst day since 2008 and yet still posted an 11% loss for the week after falling into a bear market just 14 days after closing at a record.
Got that? No? That’s ok. Nobody knows what’s going on. As one strategist put it Friday, “markets are schizophrenic at the best of times these days”.
In South Korea, the Financial Services Commission banned all short-selling on the Kospi, Kosdaq and Konex from March 16 through September 15.
“It is the first time the regulator has prohibited short-selling since August 2011”, the Nikkei writes. The Kospi closed down “just” 3.4%, after limit-down halts prevented a historic slide near the open. Pension funds apparently increased purchases of equities.
In Japan, the Nikkei did not manage the kind of sharp recovery seen in other local markets. Japanese equities fell 16% this week.
It was the worst week since the crisis.
