Western markets couldn’t shake their malaise on Thursday, struck down by covid-19 fears and dimming stimulus hopes.
Rising coronavirus cases around the globe, and the corresponding threat of further, and harsher, lockdown measures has been on the mind of the markets all month, and today was no different.
Add onto that a reversal in the likelihood of a covid-19 relief package being passed before the election in the US –Trump poured scorn on Nancy Pelosi and Chuck Schumer in a tweet accusing the Democrats of failing to compromise on a deal – and you had the perfect storm for a troubled open.
The FTSE – which had a hell of a time of it on Wednesday following the pound’s Brexit gains – dropped 0.6%, causing it to tumble below 5750 for the first time since the start of May. It would’ve been worse off if sterling hadn’t given back a sliver of yesterday’s blockbuster rebound, the currency dipping 0.2% against the dollar and euro alike.
In the Eurozone the session’s losses were even more pronounced. With daily German covid-19 cases crossing the 10,000 mark for the first time, the DAX continued to unravel, shrinking by 1.2% to hit a near 12-week nadir of 12,410. And as France sees cases hit the 1 million mark – hot on the heels of Spain, which became the first European nation to pass that terrifying milestone – the CAC shed 0.9%, falling to 4800.
Slipping 100-ish points last night, the Dow Jones is set to avoid the same kind of losses as Europe – though there is a long way to go between now and the US open. The futures are pointing to an 85 point decline, one that would leave the Dow at a 2-week low of 28,125.
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