Pandemic will likely get worse before it gets better
Shares were often cheaper in Asia on Wednesday, as governments in the region reported surging numbers of confirmed coronavirus cases.
U.S. futures also trimmed lower, though President Donald Trump’s statement that the pandemic will likely get worse before it gets better had little impact, analysts said.
Germany’s DAX slipped 0.5% to 13,117.16 and the CAC 40 in Paris lost 0.8% to 3,075.15. Britain’s FTSE 100 skidded 0.8% to 6,216.99. U.S. futures were little changed, with the contract for the S&P 500 down 0.2% while the Dow industrial’s future edged 0.1% lower.
Stocks retreated in Tokyo, Hong Kong, and Sydney but edged higher in Shanghai.
Australia’s hard-hit Victoria state reported a record 484 new COVID-19 cases, and health authorities there warned that numbers could continue to rise if the sick continue to fail to isolate themselves. The Australian share benchmark, the S&P ASX/200, gave up 1.3% to 6,075.10.
Tokyo and Honk-Kong expressed alarm
Local officials in Tokyo and Hong Kong also expressed alarm at surging numbers of infections.
Adding to unease was a report by the U.S. Centers for Disease Control that the number of coronavirus cases in some states is much higher than has been reported. Experts have said all along that the toll from the COVID-19 pandemic is much higher than tallies of confirmed cases would indicate, due to issues with testing and data collection.
Tokyo’s Nikkei 225 index lost 0.6% to 22,751.61 while the Hang Seng in Hong Kong shed 0.6% to 25,494.08. The Shanghai Composite index gained 0.2% to 3,328.68.
The S&P ASX/200 in Australia skidded 1.3% to 6,075.10. Shares rose in Taiwan, Kuala Lumpur, and Jakarta but fell in Singapore and Bangkok.
“Asia markets are not expected to share in the cheer this midweek with some doubts cast on progress in delivering the next fiscal support for the U.S. economy,” Jingyi Pan of IG said in a commentary.
The economic downturn in America
The Federal Reserve’s efforts to support markets and expectations that Washington eventually will deliver more financial aid to help Americans weather the economic downturn have been key in keeping markets mostly pushing higher since stocks plunged in March.
Among big companies reporting results this week: Microsoft and Tesla issue results on Wednesday, Intel, AT&T, and Twitter report on Thursday and Verizon Communications and American Express report earnings Friday.
The yield on the 10-year Treasury was steady at 0.60% after slipping to 0.59% late Tuesday. The yield is a benchmark for interest rates on mortgages and other consumer loans.
In the commodities markets, the price of benchmark U.S oil dropped 36 cents to $41.56 per barrel in electronic trading on the New York Mercantile Exchange. It jumped 2.8% to settle at $41.92 a barrel on Tuesday. Brent crude oil, the international standard, lost 31 cents to $44.01 per barrel.
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