 Okay, very good morning. It is Tuesday 17th of March I think before I really kick things off just a quick word first and foremost obviously what we do at Amphi trading and what we talk about on our briefings is all market related but that doesn't take away from the fact that you know absolutely first and foremost this is a humanitarian issue And we'll try to be as sensitive as we can in regards to talking about this topic obviously it is what is driving markets at the moment so we wouldn't be doing our job if we didn't talk about it but obviously we send our sympathy to any of those affected by this issue and hopefully all of our followers you'll stay well you your friends and your family going forward but let's just push on and let's talk about what is moving markets this morning and obviously as I said it is still this kind of screen that people are monitoring very closely and particularly that the numbers that are mounting outside of China very similar pattern to what we've seen of late where the other location i.e the yellow line is now sharply above the orange line that being the flatlining we've seen in mainland China and what does that lead to well yesterday as i'm sure you saw quite unbelievable really getting down i did have one of the new traders yesterday talking to me about what happened in 2008 and he was asking me have we ever hit level two in the price limits and i was and actually i can't remember when we ever did in terms of level two level two being 13 percent when stock markets are actually active on the on the floor but yesterday we actually did get down to those those types of levels the S&P actually plunged about 12 percent the biggest one day fall then it outweighed some of the moves we had last week biggest one day fall since black monday of course in october of 1987 the main thing here is not so much the fact that more confirmed cases and deaths are happening around the world it's now the economic reality i guess of countries tightening restrictions on public movement in order to curb the spreading of the virus which is causing the most reaction if you like in markets and we certainly saw that yesterday if we look at the actual this is a heat map of the S&P 500 and as you can see it's an absolute sea of red some of the biggest tech giants microsoft were down about 15 percent some of the big money center banks in the financial sector down about 15 percent for jp bank of america was fargo however what was i thought quite interesting and there is actually a couple of spots of green on the otherwise completely red heat map and i think it's quite telling from a reaction effects to how sectors have been moving in response to the coronavirus so the companies that actually moved higher yesterday despite one of the biggest down days in history was the world's biggest gold miner newmont corporation was jm schmucker company which is basically processed and packaged food and then clorox which is the bleach company so basically cleaning companies gold and packaged processed food companies outperforming as you would probably imagine in these types of times when there's been lots of global stockpiling by consumers fearful of the worst and complete national shutdowns in that respect so with this and what has it led to well there's quite a few people now talking about potential short selling bans about even the prospects of just shutting the stock exchange for a couple of weeks you know the thing about a virus of course is that a virus naturally once enough people have been infected the virus has no one else then to infect and so therefore naturally you get this kind of bell shape where then once we go over a critical point cases then start to decrease hence the thinking of the UK government before which was quite brash and obviously had a negative public reaction was that everyone should go about their business and get infected because the quicker that happens the quicker we can bounce back that in theory makes sense but obviously the practicality of that is that we're talking about human loss of life here so and this is why someone like Boris Johnson obviously has changed tact quite severely yesterday the UK Prime Minister said that we should avoid offices pubs and traveling particularly if it's non-critical this kind of idea of not having any mass gatherings the Trump administration what did they say yesterday well that they're not currently considering a national lockdown like what we've had in Italy or in Spain for example they are looking at certain regions in terms of where they're suggested is the worst areas of the outbreak that they might take specific measures remember we spoke yesterday about New York and LA for example shutting down restaurants only for takeaway business however he did say something quite interesting Trump in that the outbreak could be over by July August perhaps even later and so this I think as well is what's providing this continuous kind of downside weight on markets is this idea that you know this is becoming a much more long-term protracted issue than perhaps a few people were thinking just a week or two ago you know this this idea as we've mentioned before about this V shape recovery turning to U shape turning to something more kind of akin to the financial crisis L shaped if you like is kind of we're going through the alphabet slightly in terms of how quickly people think we can return to some degree of normality and I think what was very important was yesterday you remember I showed you that graphic of the almost catastrophic drop-off in Chinese economic data and this is what Goldman Sachs have said they've revised and obviously they've become quite bearish remember they were putting out a call for 2000 in the S&P as their ultimate kind of low in the most bearish scenario they've said that they've cut their Q1 GDP estimate for China to a contraction of 9% that's from a revised call where they've previously brought that down to a still growth of two and a half percent so that's a meaningful and sizeable in history would be one of the biggest drops ever that we would have seen and so yeah it's these sorts of things you know China being that far ahead of the curve in terms of the impact and the fact that in mainland Europe and basically everywhere else in the globe things are set to get much worse would suggest then that this is this is the reality and I think certainly what hit home at the weekend I had a number of calls off a few of my close friends particularly back from my school days who perhaps I haven't spoken to in a while but they're obviously aware of what I do as a job and they were asking me about the likelihood of them losing their jobs and how bad is the recession going to be you know and this is the real reality the tangible impact that this coronavirus is ultimately going to have and this is why we're seeing such a grave weight in markets in this continuous kind of large-scale market movement I mean just to put it into some perspective this is the S&P 500 and it's looking at the daily percentage price changes and the S&P 500 has risen or fallen at least 4% for basically six days in a row and the only time I can really remember in in my career is back in the kind of depths of 2008 when the market was kind of moving in such a fashion to give you some idea though of what's been happening and how people have been trying to counter at this in the marketplace well for one we've had central banks and yes the Fed and other central banks of taking taking kind of coordinated action to lower interest rates back to zero in the case of the US of course they've restarted quantitative easing the other thing that they've been looking at is this is the the dollar swap lines this is another form of the Federal Reserve and teaming up with the other world's largest central banks like the Bank of England the ECB the BOJ is looking to make sure that we don't get what we had in the financial crisis which is a complete loss of confidence in the system which led to an ultimate credit crunch and that's what was kind of what is at this point at least slightly different that was a financial crisis this is more of an economic crisis at this point but last night you had Japanese banks tap the Fed's beefed up swap lines for 32 billion dollars now that actually is a good thing for a case of liquidity if that was a key systemic risk to the system the fact that these are and this is what they're meant for is to counteract any of those potential kind of freezes on liquidity like what we had back in what September time of last year when we first started to see those episodes of repo rate spikes and obviously the Fed have been very active there now this is happening and this is quite crucial and I actually think that this is perhaps although I don't think we're over the worst in terms of the equity route these are positive signs that have been seeing on the ground and if anything I think the the bond market perhaps a little less sensitive to what we've been seeing in the equity market and perhaps that's a reflection of some of these other tools if you like kicking in the other thing then is banning of short selling and I've had a few questions on this now banning of short selling did happen in the global financial crisis I think it was in the autumn of 2008 when it was really all kicking off at the time that led to temporary short selling ban and restrictions in the lights of the US the UK Germany and others generally then what this has led to is Spain Italy have followed suit it's not particularly uncommon for countries like Italy and their consul to ban short selling just given the volatility that they've experienced in her local market really ever since not just a financial crisis but this european sovereign crisis as well of kind of the 2010 to 2012 era but this is another I guess countermeasure to stop the a persistent breakdown in markets that we have been seeing I mean they are temporary in nature are very unusual that they would be long lasting giving the kind of the kind of free market nature of movement that we're most used to seeing as a natural ability for people to be out of short but obviously this is something that gets adopted in lights of China for a long time so it's not massively uncommon I wouldn't say this is the sole reason of why we've bounced this morning I mean if we actually look at the actual charts looking at the DAX center left the NASDAQ and the S&P well US index futures are actually limit up that means remember outside of cash trading hours you have a five percent kind of circuit breaker either side in Globeck's electronic trade where until markets open in New York then it resets to the 7 13 20 percent price limits so we got there pretty quick overnight in fact in the Asia Pacific session it's quite a case of the NASDAQ and we got it we got there pretty quick as well in the same case of the other major US indices but I'd say this is very common when a market overextends by the tune of 12 maybe 13 percent in the case of the Dow a natural bounce back of multiple percentage points is not uncommon remember we did see this on Thursday night going into Friday only then for the market to to fall over again and so definitely I wouldn't read too much into it at this point I still think that overall this this period of volatility is here to stay for the time being and I still think that the way these governments have been acting at the moment further more onerous kind of quarantined measures are somewhat inevitable and that is only going to amplify the impact of the economic damage that's going to have to be priced into markets so I do think there is somewhat worse to come for that for the equity market however as I said we have bounced a little bit from the overnight session Australia's stock market was up over 5% after plunging nearly 10% a day earlier it's the biggest rise in fact seen in Australian markets since 1997 Australian regulators have also yesterday they were telling traders in the country's equity markets that after trade significantly less in order to stop this kind of excessive volatility so yeah at the moment it almost feels like we're in a bit of a holding pattern perhaps slight pause for breath but I do think it's literally that and that when we exhale to use that analogy I think we're in for another perhaps quite bumpy day ahead and I don't think this week is going to be without its multiple percentage point moves again so with that I'm going to have a quick review of the calendar and to stress not that I think that the calendar is particularly important because any economic data now is nigh on useless in terms of what it means really from an economic and monetary policy reaction it is so dwarfed by now the period and the challenge that world economies face going ahead the you know economic data that inherently majority is backward looking in in terms of hard data is really of no consequence so we're going to get things like the average earnings numbers coming out in the UK the unemployment rate coming out these are January figures as I said I would not anticipate these to move the currency market. German ZEW sentiment that could be interesting this is economists and analysts kind of current and six months forward looking expectations of the future and to just just to get it and quantify the impact of how bearish have they become in their views that that soft data certainly is much more telling than this current point in time. US retail sales in February probably not going to capture this latest kind of escalation than what we've seen particularly for US consumers and also the move that we've seen from the from the US administration of late so again it's probably something to be aware of but maybe not the definitive factor for the session same case really goes for the industrial production capital utilisation later on from the US and business inventories all more focused then on just the bigger broader picture at play. All right, Sam come on and he can have a chat as well on a few levels but if there's any comments of course just let me know in the chat room and I'll be happy to address those as we go throughout the day otherwise I'm going to wish you a great day ahead. Thanks very much.