The big global story remains the coronavirus outbreak that is weighing-in on global equity markets. China has reported over 400 new cases, while cases outside of China are now increasing in countries like South Korea, Iran and European countries like Italy, Switzerland and Austria.

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Shane Oliver of AMP Capital Investors said, “Initially the focus was on China and key to watch there was the number of new cases on a daily basis. But that has been falling steadily over the last month. In fact the total was around 2950 towards the beginning of the month and now it is 500. So, that is quite a big reduction in China.”

“However, the problem is the spread of the virus elsewhere around the world and that is what is unnerving investors all around,” he said.

So, the focus now is on containing the virus outside of China. “For investors it is a very difficult environment because on the one hand you can imagine global pandemic shutdown in activity, in various countries around the world as it has been in China, obviously causing a deep contraction in global GDP," he said adding that the fear is it maybe sort of go on for a lot longer than just the current quarter. So, I would watch for the number of cases, he said.

"Initially, I was focused on number of cases in China and now I am focused on the number of new cases outside China at the moment. And then the thing is to position for rebound, which will come because if you are see significant monetary easing in China, fiscal stimulus as well, odds are that we are going to see more of that around the world - probably the Fed also cutting interest rates, Europeans cutting interest rate, and that in turn will set markets up for a rebound.”