• The Star Staff

Stocks slide on surging COVID-19 cases, stimulus doubts; dollar rises

Shares fell across the globe on Monday as surging coronavirus cases in Europe and the United States clouded the world economic outlook, giving the U.S. dollar a safe-haven boost.

The euro meanwhile traded 0.3% higher at $1.1756 and sterling rallied back to near $1.30 levels against the dollar on Monday. Investors cut their holdings as British and European negotiators tried to salvage post-Brexit trade talks. “EU-UK trade talks are flirting with collapse,” ANZ economists said. “UK Prime Minister Johnson said the UK needs to prepare for a no-deal outcome, as both sides cannot agree on a Canada-style FTA. Talks resume in London on Monday, but without the political willingness to shift ground, there is little the negotiators can achieve.”

The United States, Russia and France set new daily records for coronavirus infections as a resurgence of the virus swelled across parts of the Northern Hemisphere, forcing some countries to impose new curbs.

The spreading pandemic, along with lack of progress on a U.S. stimulus package and caution ahead of the Nov. 3 U.S. presidential election, dragged down the MSCI world equity index .MIWD00000PUS.

“It’s almost entirely COVID-related. We thought all along that the most important factor for the market, good or bad, is COVID and it’s bad (today) because cases are rising,” said Christopher Grisanti, chief equity strategist at Mai Capital Management in Cleveland.

“The administration has come out and said it does not want to slow down the economy, yet as cases rise they may not have a choice. So the administration is in a difficult position.”

The Dow Jones Industrial Average .DJI fell 767.56 points, or 2.71%, to 27,568.01, the S&P 500 .SPX lost 77.75 points, or 2.24%, to 3,387.64 and the Nasdaq Composite .IXIC dropped 250.24 points, or 2.17%, to 11,298.04.

The pan-European STOXX 600 index .STOXX lost 1.81% and MSCI’s gauge of stocks across the globe .MIWD00000PUS shed 1.78%.

MSCI’s gauge of stocks globally hit a record high in September and brushed against it earlier this month.

Emerging market stocks lost 0.70%. MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.39% lower, while Japan’s Nikkei .N225 fell 0.09%.

Europe became the second region after Latin America to surpass 250,000 COVID-19 deaths on Saturday, according to a Reuters tally, as many European countries reported their highest number of infections in a single day.

Sentiment was also hit by a survey showing German business morale fell in October for the first time in six months.

Recent Posts

See All

Subscribe to Our Newsletter

© The San Juan Daily Star