World stocks ease further from highs, oil dips on COVID-19 count
Send a link to a friend
[November 19, 2020] By
Simon Jessop
LONDON (Reuters) - World stocks eased for
the third day in a row and oil fell on Thursday, with Wall Street also
eyeing a weaker open, as widening COVID-19 restrictions weighed on
market sentiment.
Positive news about possible vaccines had helped push the MSCI World
Index to a record high earlier in the week, but investors pulled back as
a host of countries announced record infection rates and tougher
lockdowns.
At 1202 GMT, the broad gauge of global equities was trading down 0.3%,
pulled lower by weakness in most of Europe's leading indexes . U.S.
stock futures were down 0.1%.
Oil prices also fell 0.4% to 0.9% as virus restrictions crimped demand
expectations.
The weaker sentiment was triggered by a late U.S. sell-off that saw the
S&P 500 close down 1.1%, following news that the country's COVID-19
deaths had passed 250,000, setting off a host of lockdowns.
Similarly sombre news in Japan, which saw a record number of cases and a
rise in Tokyo's pandemic alert level, sent the Nikkei down 0.4%. MSCI's
broadest index of Asia-Pacific shares outside Japan fell 0.8%.
"The markets probably overshot the vaccine news and are probably just
retreating slightly now because case numbers are going up," said Gavin
Rochussen, chief executive of UK-based asset manager Polar Capital.
"The vaccine will take time to be delivered, to be administered and so
on, and I think what's happening is markets are realising that ... it's
not just the silver bullet, it will take time."
The positive vaccine news had continued yesterday after Pfizer said its
COVID-19 vaccine was 95% effective and it would apply for emergency U.S.
authorization within days, following a similar recent report from
Moderna.
German benchmark 10-year debt yields fell 1.5 basis points to -0.571%
and Italy’s 10-year BTP yield was up 0.5 basis points at 0.621%. Both
were near recent lows.
"Markets remained in limbo as vaccine hopes and fears about the fallout
of still-rising COVID-19 cases cancelled each other out," Unicredit told
clients.
[to top of second column] |
The London Stock Exchange Group offices are seen in the City of
London, Britain, December 29, 2017. REUTERS/Toby Melville
"Rising coronavirus infection numbers and new restriction measures implemented
in the U.S. are weighing on appetite for risk," it said.
Looking ahead, all eyes will be on the U.S. Federal Reserve for signs it could
step in with fresh monetary stimulus -- something two officials nodded to on
Wednesday.. Investors will also await U.S. jobs data at 1330 GMT.
Against a basket of currencies, the dollar was last at 92.543, near its weekly
opening high. Euro/dollar shed 0.1% to last trade at $1.1836.
"The vaccines news are a positive medium-term impulse for the global economic
outlook and investors are trying to weigh that against the prospect of an
imminent stalling of the European and U.S. recovery amid the prospect of
extensions of current lockdown measures," said Rodrigo Catril, a senior FX
strategist at NAB.
Sterling weakened, down 0.1% against the dollar and 0.2% per euro, on a report
Europe's leaders would demand the European Commission publish Brexit no-deal
plans as the deadline for trade talks go down to the wire.
Gold traders continued to take a longer-term view, betting the COVID-19 vaccines
would translate into a quicker economic recovery. That sent the precious metal
to a one-week low.
Bitcoin, sometimes regarded as a safe haven or at least a hedge against
inflation, also pulled back and last stood at $17,720.
(Additional reporting by Thyagaraju Adinarayan in London and Stefano Rebaudo in
Milan; editing by Catherine Evans, Larry King)
[© 2020 Thomson Reuters. All rights
reserved.] Copyright 2020 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
Thompson Reuters is solely responsible for this content. |