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Stock Strategist Industry Reports

Coronavirus' Effect on the Financial Sector

Volatility isn't always bad, and banks are better off now than they were in the financial crisis.

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Editor’s note: Read the latest on how the coronavirus is rattling the markets and what investors can do to navigate it.

Not many companies in the financial sector are immune to the coronavirus, but financial exchanges and data companies should be relatively stable. Market data is an essential purchase for many financial services companies, and higher market volatility should boost trading activity in equities and derivatives. The long-term impact is more difficult to assess, as a prolonged bear market may reduce investors’ risk appetite for an uncertain duration; turnover and liquidity may remain low despite a market recovery.

Greggory Warren does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.