News24
27 Oct 2020, 14:42 GMT+10
Most Asian and European markets fell Tuesday following a sharp sell-off in New York that was fuelled by fears a coronavirus resurgence will force fresh economically painful containment measures.
Traders have also given up almost any hope for a new US stimulus package being passed before next Tuesday's election, with Democrats and Republicans blaming each other, though there are still expectations a new deal will be agreed afterwards.
The need for a big-spending rescue for hard-hit Americans is being highlighted by a big jump in new infections across the country that observers fear will deal a blow to an already shaky economic recovery.
Data this week is expected to show record US growth in the third quarter thanks to a multi-trillion-dollar stimulus agreed earlier this year alongside huge Federal Reserve support.
However, that follows a record contraction in the second quarter, while economists have tipped the economy to shrink this year.
"The second and third wave spread of Covid-19 is possibly triggering a point of no return for some industries as the economic damage borders on irreversible," said Axi strategist Stephen Innes. "The Covid-19 induced downward spiral continues accelerating."
With an eye on next week's vote, he added: "We should expect price action to remain choppy in the days ahead, with investors very reluctant to put on any significant risk ahead of what promises to be a headline heavy week or two."
Stimulus 'urgently needed'
David Kelly, at JP Morgan Asset Management, added: "A stimulus bill in the lame-duck session is urgently needed and could be supplemented by a more comprehensive measure when the new Congress meets, early in 2021."
On Wall Street, the Dow suffered its worst day since early September, dropping more than two percent while the S&P 500 and Nasdaq also suffered sharp losses. That came after Frankfurt was hammered more than three percent, with Paris and London shedding more than one percent.
And the selling continued in Asia, though the retreat was not as painful.
Hong Kong shed 0.5 percent, while Sydney dropped 1.7%, while Wellington and Manila also lost more than one percent. Singapore, Jakarta, Bangkok and Taipei were also in the red, while Tokyo was marginally lower.
Mumbai and Shanghai ended with gains.
Seoul gave up 0.6 percent despite data showing the South Korean economy grew more than expected in the third quarter thanks to a big jump in exports.
London and Paris extended losses in opening trade, though Frankfurt saw mild gains.
"The optimism of the summer has been replaced by the pessimism that administrations are desperately trying to get a handle on the situation," said CMC Markets analyst David Madden.
"In the last few months, the services and manufacturing data from the major eurozone economies have broadly painted a picture of an economic recovery that is running out of steam. In light of the latest measures taken by governments in continental Europe, it is likely that economic activity will go down another gear."
Chinese e-payments giant Ant Group was planning to stop taking orders for the Hong Kong leg of its $34 billion mega-IPO owing to it being massively subscribed, Bloomberg News reported.
The dual listing in Hong Kong and Shanghai is tipped to be the biggest in history and would value the firm at about $315 billion, bigger than Wall Street financial titans Goldman Sachs and JP Morgan Chase. Its shares are slated to debut on November 5.
Get a daily dose of Central Asia Times news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Central Asia Times.
More InformationBEIJING, China: A typhoon altered its course and struck Hainan Island, southern China, late on the night of June 13. Typhoon Wutip...
BANFF, Alberta: The recent G7 summit has convened for the second and final day in the picturesque Canadian Rockies amidst escalating...
JOHANNESBURG, South Africa: A key global plan to end AIDS as a public health threat by 2030 is now in deeper jeopardy after the United...
CALGARY, Alberta, Canada - U.S. President Donald Trump has announced he is leaving the G7 summit after just one day, and after refusing...
HOUSTON, Texas: Crude oil surged to multi-month highs this week, driven by escalating tensions in the Middle East after Israel launched...
SEOUL/LONDON: A wave of flight cancellations and diversions swept across the airline industry on June 13 after Israel launched strikes...
BEIJING, China: A typhoon altered its course and struck Hainan Island, southern China, late on the night of June 13. Typhoon Wutip...
WUSHI, Taiwan: Inspired by how Ukraine has used sea drones effectively against Russia in the Black Sea, Taiwan is learning how to use...
NEW DELHI, India: Amid mounting U.S.-China trade tensions, Apple has sharply increased iPhone shipments from India to the United States,...
NEW YORK CITY, New York: Investor confidence in U.S. markets is showing signs of strain as global funds redirect billions toward Europe...
NEW DELHI, India: A scorching heat wave is engulfing northern India, with temperatures rising well above normal and causing significant...
TOKYO, Japan: Japan has a new top sumo wrestler — and he's Japanese. Onosato, who weighs 191 kilograms (421 pounds), has become a yokozuna,...