Coronavirus Update: HUGE Impact on Chinese Auto Sector
Welcome to our weekly trading preview, your trusty dose of market updates, insights, and info. This week we’ll bring you an alarming update on the impact of the coronavirus (COVID-19) on the Chinese economy, followed by our rundown of the most important events for your trading calendar, uncovering those that are potentially the most volatile. Let’s begin!
Chinese Car Sales Almost Wiped Out
Car sales in China fell by a monumental 92% during the first half of February. Why? We’ll give you one guess. Yep, the coronavirus shutdown has already begun taking its toll on the Chinese economy.
The country has ground to a halt, car dealerships are shut and potential buyers have been warned to stay away to prevent the spread of the deadly virus.
Remarkably, a fall of 92% is actually an improvement on the first week of the month, which saw auto sales slip 96% across the country.
Officials are adamant that things will pick up when the country begins to get back on its feet, and dealerships begin opening their doors once more.
Others are trying out more novel methods to sell their four-wheeled goodies. Like Chinese car manufacturer Geely, who has just announced a “contactless” service which lets customers buy its cars online and have them delivered directly to their homes. Yep, mail-order cars are now an actual thing!
What Does This Mean?
China is the world’s biggest car market, selling just over 21 million cars last year. The US is the second-biggest market. Now, when car sales in the world’s biggest car market drop by 92% people start to get more than a little twitchy.
And it’s not just China, nor indeed the car industry that is taking a hit. Global manufacturers are also facing production delays, with Apple (AAPL) also warning of iPhone supply shortages.
This is an early sign of the impact that such a pandemic can have on both the national and international stage. Keep your eyes on this, traders. These are just the first signs of the impact that the outbreak may have. We could see many more in the weeks and months ahead.
Trading highlights of the week
A relatively quiet week of trading opportunities lies ahead. Your time is precious, so we’ll get to the point.
● A slow start to the week means that you’ll potentially have a bit of free time on Monday, Tuesday and Wednesday (no major events scheduled). Why not use that time to:
- study up;
- refine your trading strategy;
- do some technical analysis;
- check out some other instruments, stocks, commodities, crypto?
- Or, talk to our team about financial services content marketing!
● The FX market kicks-off on Thursday with the US’ Nondefense Capital Goods Orders ex Aircraft (Jan) and the Annualised GDP (Q4) (USD). Following those, Tokyo will announce its CPI Excluding Fresh Food (YoY) for February (JPY).
● On Friday, you’ll want to tune in to the EU’s Harmonised Index of Consumer Prices (YoY) for February (EUR) and Canada’s Annualised GDP (QoQ) for Q4 (CAD).
That’s it for this week. If you liked what you read and think that your traders and investors might too — contact us. Maybe you’re looking for a weekly preview article like this, or perhaps you want something a little different. Whatever you’re after, we’re ready to help.
Speak soon!
The Contentworks team
