TOKYO, Oct 29 ― Asian stocks were set to join a global sell-off today as worries about surging coronavirus cases in Europe and the United States sent investors scrambling for safe-haven assets.
Australia's ASX 200 fell 1.73 per cent in early trade, while Hong Kong's Hang Seng index futures were off 0.8 per cent.
Japan's Nikkei 225 futures were up 0.24 per cent but down 1.23 per cent from the underlying index's close yesterday.
MSCI's gauge of stocks across the globe was down 2.89 per cent.
Surging coronavirus cases in the United States and Europe were a growing concern as French and German leaders announced new lockdown measures to combat rising infections. Worsening matters for investor enthusiasm were dwindling hopes for any imminent US economic relief package with a presidential election less than a week away.
“Risk sentiment took a nose dive on Wednesday amid more concern around the spread of Covid-19 and renewed restrictions in Europe,” ANZ analysts wrote in a note.
“This was seen alongside ongoing concerns about failure to agree on US fiscal aid before the election next week, adding to a weak economic picture.”
US and European stocks faced a brutal trading day yesterday with major Wall Street indices down 3 per cent and the Dow at its lowest levels since late July. Energy and technology stocks led the declines.
The Dow Jones Industrial Average fell 3.43 per cent, the S&P 500 lost 3.53 per cent, and the Nasdaq Composite dropped 3.73 per cent.
Wall Street's “fear gauge” is on pace for its biggest weekly jump since March, when the pandemic took off in the United States. The Cboe Volatility Index surged yesterday to its highest level since June, ending at 40.28.
Looming large ahead is today's advance report on US third-quarter economic growth, with analysts expecting record growth but not enough to make up for the hit from the pandemic.
A closely watched estimate model used by the Atlanta Federal Reserve shows third-quarter growth at a 37 per cent annualised pace, which would only account for about 71 per cent of the US$2.2 trillion (RM9.1 trillion) in lost output so far in 2020.
Oil also took a big hit today, falling over 5 per cent to a four-month low as coronavirus concerns weighed on demand expectations. Brent futures fell US$2.08, or 5.1 per cent, to settle at US$39.12 a barrel, while US West Texas Intermediate (WTI) crude fell US$2.18, or 5.5 per cent, to US$37.39.
Investors seeking a safe-haven moved into the greenback with the dollar index rising 0.3 per cent against a basket of six currencies.
The flow to the dollars weighed on gold with the yellow metal settling down 1.56 per cent at US$1,877.06 per ounce, after falling as much as 2 per cent yesterday.
Benchmark 10-year notes last rose 1/32 in price to yield 0.7743 per cent. ― Reuters
Source: Malay Mail
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