Markets and stocks in Europe were hit hard over the weekend, and though there has been some rebound, the spread of the coronavirus outbreak is seriously affecting markets worldwide. 12 Italian towns were locked down over the weekend, following over 150 cases and four deaths. As a result, the pan-European STOXX 600 index and  Italy’s FTSE MIB Index were down 3.3% and 4.3% respectively.

“Italy’s lockdown, as the country tries to control the worst outbreak of the virus in Europe, has caused investors to panic about how business and society will be affected,” Russ Mould, investment director at AJ Bell, told Yahoo Finance.

“There has been so much complacency in recent weeks from investors, despite clear signs that China’s economy is facing a large hit and that supply chains around the world were being disrupted,” he added.

On the other hand, gold has seen a strikingly opposite effect, as the value of gold has now reached a seven-year high in the wake of the coronavirus outbreak. It’s clear that although some investors have been complacent in protecting their investments, some have resorted to storing their money in gold, a safe investment space.

According to recent figures, gold prices climbed around 2% this week, up to levels not seen since February 2013. Prices are now fluctuating as high as $1,678.58 an ounce.

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On the topic of complacency, the deVere Group’s CEO, Nigel Green has warned: “Many investors remain complacent about the far-reaching impact of coronavirus, which is continuing to spread – and at a faster pace. This will inevitably hit financial markets and investors’ complacency leaves many wide open to nasty surprises.”

“Against this backdrop and with the ongoing uncertainty over the direction of stocks and other risk assets, multi-asset portfolios might be favoured by global investors, given that they offer diversification of risk as well as of return.”