Asian stocks hit by surge in coronavirus cases, US stimulus issues

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(Reuters) – Asian stock markets fell on Tuesday as the surge in global coronavirus cases and slow progress on a U.S. stimulus deal hammered investor sentiment and wreaked havoc on Wall Street.

FILE PHOTO: Passers-by wearing face masks are reflected on a stock quote board outside a brokerage house in Tokyo, Japan September 17, 2020. REUTERS / Issei Kato

MSCI gauge of Asia-Pacific stocks outside of Japan .MIAPJ0000PUS was down 0.43%, with the Australian ASX 200 .AXJO 1.1% to a nearly three-week low.

China CSI300 Index .CSI300 edged down 0.1% as investors watched for news of a meeting of Chinese Communist Party leaders to set the next five-year plan.

Data released earlier today also showed that China’s industrial profits grew at a slower pace in September, suggesting that a recovery in manufacturing has yet to be corrected.

In Japan, the Nikkei 225 reference NKc1 fell 0.28% in morning trading while Hong Kong’s Hang Seng index .HSI was down 1.02%.

U.S. indices fell sharply overnight to open up trading for the week as anxiety over new daily record COVID-19 cases in the United States, Russia and France weighed on people’s appetites. investors.

Adding to the gloom, White House economic adviser Larry Kudlow told reporters on Monday that talks over a coronavirus relief program had slowed, although House Speaker Nancy Pelosi remained in the office. hope that a deal can be reached before the November 3 elections.

Many Senate Republicans resisted sweeping legislation that Pelosi and Mnuchin discussed, totaling around $ 2 trillion.

“The challenge for the markets is that in most cases they are already assessing a very strong economic rebound. The new outbreaks and the potential for a double-dip recession directly contradict that assumption, ”Michael McCarthy, chief market strategist at CMC Markets in Sydney.

National polls give Democrat Joe Biden a solid lead over President Donald Trump, but the competition is much tighter in battlefield states that could decide the outcome.

The sharp drop in equity markets set a somber tone ahead of a busy third quarter earnings season, with big U.S. tech companies like Apple Inc AAPL.O, Amazon.com Inc AMZN.O et Google-parent Alphabet Inc GOOGL.O set to report. Microsoft Corp MSFT.O reports on its results on Tuesday.

The Dow Jones Industrial Average .DJI fell 2.29% overnight, the S&P 500 .SPX lost 1.86%, while the Nasdaq Composite .IXIC fell 1.64%.

The dollar = USD held broadly stable, moving just a little lower to trade at 92.951 against a basket of six major currencies.

Much of the trading in currency markets, as well as other asset markets, has been rocked by renewed fears of coronaviruses.

In early Asia, oil prices were able to curb a prolonged sell-off even though the outlook was dim amid concerns over the virus demand on demand. Brent raw LCOc1 was up 12 cents, or 0.3%, to $ 40.58 a barrel at 12:39 a.m. GMT, after falling more than 3% overnight. American Oil CLc1 was up 13 cents, or 03%, to $ 38.69 a barrel, after also falling more than 3% on Monday.

L’or spot refuge XAU = added 0.3% to $ 1,907.41 an ounce on Tuesday morning.

Reporting by Kane Wu in Hong Kong and Pete Schroeder in New York; edited by Richard Pullin & Shri Navaratnam

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