Investing.com -- Apple's sales warning is a dim memory as risk assets march higher, along with gold, on expectations that central banks will pick up the pieces if the coronavirus does hit the world economy badly. Five Federal Reserve officials' speeches today will test that thesis. Mike Bloomberg makes his debut in the Democratic Party debate this evening, and crude hit a three-week high ahead of the release of private estimates of U.S. oil stocks later. Here's what you need to know in financial markets on Wednesday, February 19th.
1. Melt Up; Gold touches 7-year high
After a sell-off that lasted almost 24 hours, markets are back in risk-on mode, convinced that the economic impact from the Covid-19 outbreak will be brief and manageable, and equally convinced that global central banks will support markets at current levels even if it isn’t.
Indicators of excess flashing red include a seven-year high for gold futures at $1,613.95, and another 7.4% rise in futures on palladium, as portfolio investors pile into a supply squeeze caused by production issues in South Africa and a surge in demand from the automotive industry, its biggest user.
That comes against the backdrop of another surge in Tesla (NASDAQ:TSLA) stock after analysts at Piper Sandler raised their price target by 27% to $928, citing the outlook for its energy generation and storage businesses. That means that Wall Street now has at least one analyst supporting the optimism of Tesla’s notoriously bullish retail investor base.
2. Fed speeches, minutes to provide reality check
3. Stocks march higher, shrug off Apple (NASDAQ:AAPL) warning
