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Asian stocks set to fall sharply as Wall Street tumbles

EconomyJun 11, 2020 08:10PM ET
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© Reuters. People are seen on a pedestrian overpass with an electronic board showing the Dow Jones and S&P 500 indexes, following an outbreak of the novel coronavirus in the country, at Lujiazui financial district in Shanghai

By Chibuike Oguh

NEW YORK (Reuters) - Asian equities are set to fall sharply on Friday after Wall Street stocks and oil tumbled over growing concerns that a resurgence of coronavirus infections could stunt the pace of reopening economies.

The three major U.S. stock indexes fell more than 5%, posting their worst day since mid-March, when markets were sent into freefall by the abrupt economic lockdowns put in place to contain the pandemic.

"All of a sudden the coronavirus, which has been an also-ran story for some days now, became more important as the virus began picking up in some states, and the market began thinking there may be delays to reopening," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

Australian S&P/ASX 200 futures were down 3.04% at 20:59 GMT, while Japan's Nikkei 225 index closed down 2.82% at 22,472.91​​​​ on Thursday. Hong Kong's Hang Seng index futures were down 2.06%.

Cases of the disease have jumped in several U.S. states in recent days, raising concern among experts who say authorities have loosened restrictions put in place to contain the spread too early.

Cases in New Mexico, Utah and Arizona rose by 40% for the week ended Sunday, a Reuters tally shows. Florida and Arkansas are other hot spots.

The U.S. Federal Reserve released a gloomy economic outlook at the end of its two-day monetary policy meeting on Wednesday. Chair Jerome Powell warned of a "long road" to recovery.

Economic data appeared to back up the Fed's projections, with jobless claims still more than double their peak during the Great Recession and continuing claims at an astoundingly high 20.9 million.

On Wall Street, the Dow Jones Industrial Average dropped 6.9%, the S&P 500 lost 5.89%, while the Nasdaq Composite shed 5.27%.

Oil prices tumbled on renewed concerns about demand, as new cases of the coronavirus disease rise globally, and a large buildup of U.S. crude inventories. [O/R]

Benchmark Brent crude futures settled 7.62% lower at $38.55 a barrel in U.S. trading hours, before sliding further in Asia on Friday. U.S. crude oil futures settled at $36.34 a barrel, down $3.26, or 8.23%.

U.S. Treasury and euro zone government bonds rallied after the Fed on Wednesday signaled it plans years of extraordinary support to counter the economic fallout from the pandemic.

Yields on 10-year Treasury notes dropped sharply from last week's peak of 0.96%. [US/]

The 10-year Treasury note fell 8.6 basis points to yield 0.6625%, while Germany's 10-year benchmark fell 10 basis points to a nine-day low of -0.43%.

Gold futures settled more than 1% higher and the dollar, yen and Swiss franc all benefited from safe-haven flows.

The yen rose to a one-month high against the dollar, while the Swiss franc climbed to a three-month peak. The dollar also rose 0.4% to 96.556 against a basket of currencies.

The euro fell 0.63% to $1.1297, and the yen slid 0.22% to $106.8500.

U.S. gold futures settled up 1.1% at $1,739.80 an ounce.

 

Asian stocks set to fall sharply as Wall Street tumbles
 

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Comments (10)
Ha Has
Ha Has Jun 12, 2020 12:42AM ET
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US futures are soaring. Today was just an artificial dip so the big players make quick millions tomorrow.
Indiana Jones
Indiana Jones Jun 12, 2020 12:06AM ET
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The US markets will open up on Friday, as if stocks are on sale. Do you really believe Thursday’s selloff was all retail money, and that institutions will buy everything back tomorrow? Sucker’s rally. In the afternoon, it’ll be “look out below” cuz no one wants to be long going into a weekend when covid hospitalizations could start piling up in “open” states, thus stifling an economy that is already going to recover much more slowly than the market had been pricing in. Is anybody out there over the age of 40 (the folks with the most disposable income) going on a long flight or on a cruise anytime soon? Or eating and drinking in crowded venues? Wait until the NFL season either gets postponed or there can be no fans at the games.
Gamer Turtle
GamerTurtle Jun 12, 2020 12:04AM ET
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slowly being bought up again. lol. us future already up by more than 1%
Thom Miller
Thom Miller Jun 11, 2020 11:43PM ET
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Not only has Trump ruined the US stock markets, he’s going to drag the rest of the world through his slime and mud as well.
Indiana Jones
Indiana Jones Jun 11, 2020 11:43PM ET
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Sorry, but how has T “ruined the markets”? If Biden starts beating him in the polls, your investment account(s) will truly be ruined cuz we’ll start a cold(er) war with China so people will be afraid to change ships in midstream. If it looks like Biden could indeed win, I’d be getting familiar with the Direxion family of inverse leveraged funds.
Riley Hayes
Riley Hayes Jun 11, 2020 11:43PM ET
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Biden has been leading in the polls for a while now. Double digit lead currently.
SANJAY KAPOOR
SANJAY KAPOOR Jun 11, 2020 11:33PM ET
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going by this fall, Sensex and Nifty may open with a similar lower gap of close to 5%
Tim Mcdaniel
Tim Mcdaniel Jun 11, 2020 11:06PM ET
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haha you wish.
mohammed mebrouk
mohammed mebrouk Jun 11, 2020 11:01PM ET
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it will be even more down next week , another 3 % is coming
Tim Mcdaniel
Tim Mcdaniel Jun 11, 2020 11:01PM ET
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based on what?
Jeff Bauman
Jeff Bauman Jun 11, 2020 11:01PM ET
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based on what people with brains believe... obviously you're not included
Vikrant Sethiya
Vikrant Sethiya Jun 11, 2020 10:22PM ET
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the main problem is last night us market fall and now futures are up that's why it is not affecting the way it should have
Thom Miller
Thom Miller Jun 11, 2020 10:22PM ET
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Huh? Say again.
Robert DZ the patterns
Robert DZ the patterns Jun 11, 2020 9:32PM ET
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It's not even a correction, small dip. Earned 19k today
Show previous replies (1)
Robert DZ the patterns
Robert DZ the patterns Jun 11, 2020 9:32PM ET
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Thom Miller   was 76% up at 5 pm TVIX
Adam Wolff
Adam Wolff Jun 11, 2020 9:32PM ET
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what stock yielded you 19k Robert?
Robert DZ the patterns
Robert DZ the patterns Jun 11, 2020 9:32PM ET
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Tim Mcdaniel
Tim Mcdaniel Jun 11, 2020 9:32PM ET
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risking how much capital?
Robert DZ the patterns
Robert DZ the patterns Jun 11, 2020 9:32PM ET
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Tim Mcdaniel  26k, I bought TVIX at 108.9 last friday, it was well over $200 today
Mike Chen
Mike Chen Jun 11, 2020 9:28PM ET
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Asian stocks are up. Not affected by US overnight drop
Ronald Warren
Ronald Warren Jun 11, 2020 9:28PM ET
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You're looking at futures. switch over to indices.
Dewakar Khanna
Dewakar Khanna Jun 11, 2020 9:28PM ET
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lol
mohammed mebrouk
mohammed mebrouk Jun 11, 2020 9:28PM ET
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hahahahaha
Robert DZ the patterns
Robert DZ the patterns Jun 11, 2020 9:28PM ET
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mohammed mebrouk   Guys, I already sold my positions with 19k profits, what do you think??
 
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