New Headlines Get the Markets’ Attention

February 18, 2020
Newspaper
Even with multiple topics in the news, the markets tend to respond only to the headlines...

 

There have been plenty of headlines in 2020 and it is only mid-February. The virus scare has died down a bit in the markets, though this is no indication that the threat of the virus has gone away. It just seems that these events can only hold the attention of the markets for just so long. A recent event reminded us of this fact.

This event was the recent Brexit day at the end of January. The UK formally has left the European Union as of January 31. Remember back to 2016 when the threat of Brexit was all over the headlines and the markets were reacting accordingly? Now Brexit has actually happened and there was barely a ripple in the markets. The coronavirus gained much more attention that day.

Of course, there is a Brexit implementation period which will last the rest of 2020. During that time agreements will be negotiated. Much like we negotiated with China on trade all last year. Last year, those negotiations were affecting the markets. The point is that the markets tend to respond to the new headlines. We are barely one-tenth of the way through 2020 and we have had plenty of those headlines already. With a Presidential election this year, we guarantee plenty more.