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COVID-19 Virus sell-off gives buying opportunity

by , 25 February 2020
COVID-19 Virus sell-off gives buying opportunity
Yesterday saw markets react decisively to the risk of COVID-19 to global growth. With most markets pulling back over 3%. This is due to an acceleration of new infections outside of China. It has hit Europe as Italy reports the 7th death and puts the town of Cologna on lock down, with others in the Lombardy region of northern Italy (a manufacturing hub) on unofficial lockdown.

The cause for alarm is the velocity of infections, while the mortality rate is low, the virus has the potential to infect millions of people globally. The mortality rate is just over 2%, in China and likely to be lower once official numbers are released globally, this is a fifth of the SARS virus mortality rate.

Governments the world over, are taking extensive measures to ensure the safety of their citizens and visitors. Areas on lock down have restrictions on movements and closures of public gathering locations like Churches, gyms, shops etc. The mass closures and restrictions are affecting the global supply chain, as companies who source inventory from China face delays.

It's estimated that it will take until July for the supply chain and production to recover and return to normal. The market will take time to recover but accumulating after big sell-offs deliver long term out performance.
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COVID-19 Virus sell-off gives buying opportunity
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