• Franklin Templeton’s Multi-Asset Solutions team discuss how to play the heightened market volatility from the coronavirus and the oil shock.
• Their base case (60% probability) remains reasonably optimistic with only a mild U-shaped recession, moderate growth in virus cases and peak infections at end Q2. Mortality rate remains around 1% and global growth slows to 2.4% in this scenario.
• The more optimistic scenario (with a 10% probability) is for global growth at 2.7% with a bottoming in activity in early Q2. A pessimistic scenario sees global growth at just 2%.
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