The market is keeping more pessimistic ahead of North American trading

We've moved past the month-end and the new month isn't exactly off to a good start so far for risk trades, especially in the equities space. European stocks are still down heavily on the session while US futures are down by around 1% currently.

The main talking point since the weekend is heightened tensions between US and China as the coronavirus blame game heats up, not to mention strained trade tensions as well.

But if you recall, the start of the more sour mood in the market also coincided with a slew of negative data from the euro area economy last Thursday.

In the coming weeks, expect economic releases to reflect worse conditions in the global economy as we start to look into April data. This should represent the height of the downturn for most major economies, so don't expect much good news during this time.

Then, you can add the fact that Warren Buffett is revealing that he is sitting on his hands and is preferring cash over anything else right now. A wake-up call for some investors?

There's also the technical explanation that the S&P 500 has ran into key resistance from the 61.8 retracement level - one that many has been focusing on.

SPX 04-05

Or perhaps it is a combination of all of those factors i.e. fundamental, sentiment, technical.

The major worry in the market right now is that this could mark the beginning of the next wave lower in stocks and risk assets. It is still early days but surely it is something that will be playing on the back of everyone's mind as the fallout builds.