On Sunday, U.K. health minister Matt Hancock warned that the country was at a tipping point regarding Covid-19. New virus cases continue to rise sharply across the EU region, which will most likely lead to another lockdown in many cities.
That will, of course, hinder economic growth further, and the economic depression could continue. Not exactly a bullish scenario for stocks, although central banks will probably start printing more money again.
Since the Fed disappointed on Wednesday, it has been a one way down for most of the equity indices. The extreme overbought conditions are unwinding fast, and at this time, it looks like markets could shed another 5-10% if the situation does not improve.
The economic calendar is empty today, as usual, on Monday. However, the Federal Reserve Chair Jerome Powell is due to speak, along with the rest of the FOMC board members, about rule-making for the Community Reinvestment Act.
Since that is not related to monetary policy, volatility should not be elevated after his speech.