Coronavirus may have sent the entire world into a tizzy but stock markets in the United States and Europe haven’t really started to bear the brunt of its outbreak. They in fact have witnessed fresh highs and only the economic damage ascertained in the future will let us know whether the ongoing global malady caused harm to the global stock markets too.
However, we came to know of 5 stocks that are presently susceptible to the pandemic in question and could perform below the traditional UK benchmarks in the coming months. Each interestingly belongs to a different sector and below you will learn how they are in for a tough time ahead:
1. Shares of Burberry Group dealing in luxury goods hovering around lowest range
Burberry Group deals in luxury goods and because of coronavirus, it has had to shut down 24 out of its 64 outlets in China. Burberry interestingly revealed that the present disturbance is proving to be more harmful than the anti-government protests in Hong Kong last year. And it comes as no surprise that Burberry shares at the moment are hovering around the lowest range.
2. Bookings and profits of Carnival, a travel company, suffering post quarantine
Carnival is a travel company whose bookings and profits have now taken a beating after 10 passengers onboard one of its cruises near the coast of Japan were found to have contracted coronavirus and the ship had to be quarantined.
3. Switzerland-based commodity producer Glencore to be swayed by downturn in China
Glencore is a Switzerland-based company that manufactures and sells metallic commoditiesand China has been one of its main buyers. A serious downturn in China’s economy could see Glencore incur losses worth billions.
4. Catalyst provider Johnson Matthey unable to send supplies to world’s largest car market
Johnson Matthey is a supplier of catalysts that mainly aspires to reduce emissions in vehicles. China happens to be the largest market for cars in the world but because of coronavirus, car manufacturing in the country has come to a grinding halt. Consequently, Johnson Matthey is unable to send supplies to China and is likely to witness a sizeable drop in the price of its shares.
5. Chinese operations of quality assurance provider Intertek likely to be disrupted
Intertrek, a UK-based company, is a quality assurance provider. Its job is to ensure the safety and quality of physical parts and products and see there is nothing amiss with the quality management systems and operating processes of its customers. The company’s operations in China are three decades old, accounting for 20 percent of the sales. This is likely to be disrupted post the outbreak of coronavirus.
Now, to delve deeper into the issues discussed above and become more informed, you can download the latest report by Clear Capital Markets on the same subject titled “How bad is the coronavirus outbreak and which stocks are most vulnerable?”, which you can download by clicking the link below:
Risk Warning: The value of shares can fall as well as rise; you may not necessarily get back the amount you invested. Past performance is no guarantee of future performance. Clear Capital Markets Limited is authorised and regulated by the Financial Conduct Authority FRN 706689.
This blog post is written by Bob Roberts, Director at Clear Capital Markets, Fully RDR Compliant (Level 6 / Valid SPS), FSA CF30 Registered, CISI Level 6 Certificate in Private Client Investment Advice & Management (PCIAM), CISI Level 4 Investment, Risk and Taxation (Part of the IAD), CISI Level 3 Certificate in Investments (Derivatives), Unit 1: FSA Financial Regulation (2010),Unit 3 Derivatives (2011)
Areas of expertise:
wealth management, portfolio management, HNW private and professional client relationship management, corporate finance, long/short and hedging strategies, risk management, equities & derivatives.