Asia Stocks Trade Lower after IMF Expects Worsen Global Economy in 2020

Stocks in Asia mostly plunged in the morning session on Thursday after the IMF slashed global GDP forecast for 2020 to 4.9% contraction.

 

As of 9:28 local time in Thailand (GMT+7), Nikkei dropped 1.41%, SSEC rose 0.30%, HSI slipped 0.50%, ASX 200 shedded 1.91% and Kospi lost 1.91%.

 

Last night, the International Monetary Fund on June 24, 2020, further downgraded global GDP to contract by 4.9% from its earlier forecast in April at 3% as the Covid-19 pandemic had more negative impact on activity in the first half of 2020 than IMF had anticipated. The Fund also slashed the U.S. 2020 GDP from 5.9% contraction to 8% instead.

 

Finansia Syrus Securities (FSS) expected SET Index to swing between 1,320-1,340 points due to the negativity in the market from IMF slashing global GDP and the increase in new coronavirus cases to weigh on investors’ sentiment and caused fund flows to seek safe assets. The analyst expected SET Index to correct after a V-Shape recovery in the past few months.