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Financial Health
March 3, 2020

Addressing coronavirus news and market volatility

Paul Christopher, head of Global Market Strategy for the Wells Fargo Investment Institute, notes current low risk for recession, and identifies sectors to watch.

Amidst the developing news on coronavirus, Paul Christopher, head of Global Market Strategy for the Wells Fargo Investment Institute, or WFII, shared insights on the current market volatility and the resulting global economic impacts.

The markets are reacting with fear, due to the unknown extent of the risks, Christopher said.

“Volatility means that market participants sell holdings when the future feels dangerous,” he said. “No one knows yet how far or fast coronavirus may spread, and what its ultimate economic impact may be.”

It is important not to lose perspective, Christopher noted, pointing to the historic data, where equity prices suffered sharp declines from prior all-time highs in 2011 (roughly 19%), in late 2015 and early 2016 (14%), and again in 2018 (nearly 20%).

The Institute is posting updates with additional insights and information on how investors may want to respond to coronavirus on the Coronavirus Impact resource page.


Risks

All investing involves risks, including the possible loss of principal.

Stock markets, especially foreign markets, are volatile. Stock values may fluctuate in response to general economic and market conditions, the prospects of individual companies, and industry sectors.

Disclosures

Wells Fargo Investment Institute, Inc. is a registered investment adviser and wholly owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company.

Opinions represent WFII’s opinion as of the date of this release and are for general information purposes only and are not intended to predict or guarantee the future performance of any individual security, market sector or the markets generally. WFII does not undertake to advise you of any change in its opinions or the information contained in this release. Wells Fargo & Company affiliates may issue reports or have opinions that are inconsistent with, and reach different conclusions from, this report.

The information contained herein constitutes general information and is not directed to, designed for, or individually tailored to, any particular investor or potential investor. This report is not intended to be a client-specific suitability analysis or recommendation, an offer to participate in any investment, or a recommendation to buy, hold or sell securities. Do not use this report as the sole basis for investment decisions. Do not select an asset class or investment product based on performance alone. Consider all relevant information, including your existing portfolio, investment objectives, risk tolerance, liquidity needs and investment time horizon.

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