Could this be the start of the second COVID-19 share market crash?

The S&P/ASX 200 Index (ASX: XJO) fell 3% yesterday and it’s expected to fall another 3% at the open. Who knows where it will finish by the end of today?

A second wave of COVID-19 was always a risk to the share market recovery. Countries like Australia, New Zealand, Taiwan and Vietnam have done a good job at controlling the spread of the virus. The north east of the US took the brunt of the initial wave. Now a lot of other US states are seeing rising numbers.

We’ve already seen that many places in the US can’t uniformly follow restriction rules, so this second wave could be harder to control. Although, the first wave didn’t really end.

Is this the second COVID-19 share market crash?

It certainly could be. A second wave was one of the key reasons that could start another share market fall. I don’t think the market was pricing in the high chance of a second wave. So if you’ve been saving your cash for another COVID-19 share market crash, this period is probably your chance.

But there’s a fair chance that this fall won’t be as bad as the first for a few reasons.

First, all of the central bank support is still there. Interest rates are still incredibly low in Australia, the US and Europe. It was seemingly the central banks stepping in that halted the crash in March.

Second, the US may be bad at controlling COVID-19 but many other places have gotten on top of it. Europe was in bad shape, but now daily case numbers are a lot lower. Several important countries in Asia are in control. We’re not looking at every developed country being in trouble. 

Third, people will expect a recovery. The first COVID-19 share market crash was only three months ago. There’s a good chance that once the market stops falling it will recover nicely again as people see value in lower prices.

Foolish takeaway

I’m going to be scanning the market today and next week to see if I can find any great opportunities. Be greedy when others are fearful. A 6% fall over 24 hours would certainly suggest that a COVID-19 share market crash may be starting. But it may be quicker and not as bad as the first. 

More reading

• Woolworths facing fresh threat from Amazon.com
• Is this why the NAB share price could be cheap today?
• ASX 200 to sink lower after Wall Street crashes on second wave concerns
• 5 things to watch on the ASX 200 on Friday
• ASX 200 drops 3%, Webjet share price sinks

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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If you’re a growth investor, then you might want to take a look at the growth shares listed below.

I believe each of these companies are well positioned to grow their earnings at an above-average rate for many years to come. Which could potentially lead to their shares outperforming the market over the long term.

Here’s why I would invest $3,000 into these ASX growth shares once the dust settles on today’s market selloff:

Aristocrat Leisure Limited (ASX: ALL)

The first growth share I would suggest you consider buying is Aristocrat Leisure. While the gaming technology company is best known for designing and manufacturing many of the poker machines you’ll find in Crown Resorts Ltd (ASX: CWN) and countless casinos across the world, there is more to it than first meets the eye. Aristocrat Leisure also has a very lucrative digital business which is generating significant recurring revenues from its millions of daily active users. I believe this side of the business will be a key driver of growth over the next decade and expect it to become the biggest earner in the near future. 

Cochlear Limited (ASX: COH)

Another growth share to consider buying is Cochlear. I’m a big fan of the hearing solutions company due to the quality of its products, its strong long term growth prospects, and its high level of investment in research and development. I believe the latter will help keep its technology at the front of the pack and underpin solid earnings growth over the next decade and beyond. Another positive is its sizeable current market opportunity. The company estimates that less than 10% of people who would benefit from an implantable hearing solution are treated.

IDP Education Ltd (ASX: IEL)

A third growth share to consider investing $3,000 into is IDP Education. It is a provider of international student placement services and English language testing services. Over the last few years IDP Education has been growing at a rapid rate. And while its near term growth will inevitably be impacted by the pandemic, I expect it to accelerate again once the crisis passes. This could make it well worth considering a patient and long-term focused investment in its shares.

More reading

• 3 ASX shares to buy now with $10,000
• Can this ASX dividend share afford its 11% yield?
• 3 safe and strong ASX 50 shares to buy right now
• 3 quality ASX 200 shares to buy and hold until at least 2030
• 10 ASX 200 shares that are fit for the Queen

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Cochlear Ltd. and Idp Education Pty Ltd. The Motley Fool Australia has recommended Cochlear Ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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