(30 JUNE 2020)DAILY MARKET BRIEF 1: Selective perception of risk.

<p>A robust 44% rebound in US pending home sales has been the major driver of gains in US equities on Monday. The data wiped out the Covid-19 concerns, pushing the Dow 2.32% up. The S&amp;P500 gained 1.47% as Nasdaq ended the session 1.20% higher. The Federal Reserve (Fed) Chair Jerome Powell sounded optimistic regarding the post Covid rebound in the US economy, but warned that the normalization may be happening too soon too fast and there is ‘extraordinary uncertainty’ regarding the virus advance, as the recent peak in new cases pushed some businesses to reconsider their decision to resume activity in the US. Powell’s optimistic but cautious stance was heard as a sign of empathy from investors, reassuring them that the Fed would continue giving the necessary support to the market. So far, the massive central bank intervention has helped reduce the tail risks in DM credit and rate markets notably, but the credit spreads remain at historically high levels and need to be monitored with caut</p>