06 / 20


The financial markets were particularly strong in June, at least until the middle of the month. Unexpectedly good labour market data from the USA and strong recoveries in leading indicators (purchasing managers indices) contributed to a good mood before rising new infections from the second half of the month onwards caused renewed uncertainty among investors. A few states in the USA were particularly hard hit and had to partially break off the current reopening. California, Texas, Arizona and Florida have recorded a significant increase in daily new infections since the beginning of June. These US member states are thus the new hotspots for new infections, which in the case of Texas can certainly also be attributed to the "lockdown" that lasted only twenty days. Apple announced some closures of shops in the affected states. On the other hand, the situation in New York, the state that was initially most affected, is under control.  In Australia too, the state of Victoria was forced to implement a new lockdown in parts of Melbourne. According to the official data, a second wave of infection has not yet occurred in China and Europe. The falling trend in daily deaths worldwide is encouraging. It probably indicates that those persons who need protection, such as the elderly and sick, are effectively protecting themselves from infection, whereas the "young" are rather unconcerned about the initial easing of the restrictions. It can also be deduced that the health system in the USA is currently able to absorb the cases well.

Equity markets

For once, equities outside the USA had the upper hand. The SMI, for example, gained around 2%, whereas the Dow Jones was virtually unchanged. The neglected crisis management in the COVID-19 chaos could now turn into a boomerang in the US and might (temporarily) normalize the already high premium of the US stock market relative to the rest of the world. The month was generally very volatile. The Dow Jones lost 6.9% in one day alone due to emerging concerns about the second wave of infections, but was able to recover slightly at the end of the month. Since the outbreak of the Corona crisis, the volatility barometer VIX has never made it significantly below the 30 mark. Under normal conditions, the index averages at 15, which, despite the strong recovery since the March lows, indicates that nervousness remains high. In Germany, the payment service provider wirecard made the headlines. The DAX-listed company was forced to file for insolvency due to balance sheet manipulation.

Interest rates

No major changes in long-term interest rates were to be observed on the capital market. Investors' appetite for yield led to further narrowing of spreads of peripheral government bonds (Greece, Spain and Italy versus Germany). High yield spreads were also slightly lower.

Currencies / Commodities

The continued weakness of the dollar has provided broad-based support for commodities (see FOCUS). Copper, which is sensitive to economic trends, rose by more than 10%. Gold advanced by more than 2% and is thus very close to the psychological 1800 mark per ounce/$. Silver, on the other hand, was unable to build on the strong gains of the previous month (May +19%).


Investor sentiment is torn between economic optimism and the resurgence of COVID-19 infections. The economic data are already showing the first surprising improvements relative to the consensus and give reason to hope for a quicker recovery. It is important that the second wave, which has already begun in some cases, can be contained locally with as little damage to the economy as possible. As mentioned at the beginning, the falling daily death rates worldwide, which are clearly against the trend in new infections, are a reason for confidence in the crisis management around the coronavirus. Further increases in the number of infections will, nonetheless, continue to strain the nerves of investors. The investor sentiment is and remains very pessimistic, which speaks in the opposite direction for a further rise in prices in the medium term ("wall of worry"). Short-term distortions due to the coronavirus or other temporary disruptive factors would thus continue to be an opportunity to increase equities.


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