Thursday, 20 February 2020
Stock markets weighed down by coronavirus fears
cases and eased borrowing costs to cushion the epidemic’s economic impact.
Traders have been betting on central banks doing what it takes to keep their economies chugging along as the new coronavirus hits corporate earnings and economic growth.
“Coronavirus uneasiness is lingering as cases continue to spread beyond China, though China did report more stimulus measures and some favourable economic data,” said analysts at the Charles Schwab brokerage.
The People’s Bank of China (PBoC) lowered its one-year and five-year loan prime rates, but the moves were “not nearly enough”, said Stephen Innes of AxiCorp.
“The PBoC needs to exceed the market expectations, not hit them in this environment,” he said.
The bank’s actions still helped the Shanghai stock market reach a 1.8 percent closing gain.
In the best-case scenario, the economic hit from the epidemic in China will be short-lived, but it comes as the global economy remains fragile, IMF chief Kristalina Georgieva said Wednesday.
Wall Street ran into intense profit-taking after record highs on Wednesday, while European stock markets were also well down by the close.
London, however, outperformed as a weakening pound gave a fillip to stock prices in the export sector.
Air France-KLM shares plunged after the airline reported that the coronavirus had blown a large hole in 2020 earnings to date while separately unveiling lower profits for 2019.
After European bourses shut, the International Air Transport Association said that worldwide airline revenue lost to the virus was projected at $29.3 billion, mostly in the Asia-Pacific region, especially in China.
The dollar rose against all its major rivals, with many analysts pointing to its safe haven status amid the coronavirus crisis.
However, Matt Weller, head of market research at GAIN Capital, said politics were also playing a role. An “underappreciated driver” for the greenback, he said, “may be the prospects for President Trump to get reelected”.
Gold, another popular safe-haven investment, continued firm after reaching a seven-year high on Wednesday.
Oil prices rebounded as hopes spread that the impact of the virus on economic growth, and therefore crude demand, will be limited.
– Key figures around 1650 GMT –
London – FTSE 100: UP 0.3 percent at 7,436.64 points (close)
Frankfurt – DAX 30: DOWN 0.9 percent at 13,664.00 (close)
Paris – CAC 40: DOWN 0.8 percent at 6,062.30 (close)
EURO STOXX 50: DOWN 1.1 percent at 3,822.98
New York – Dow: DOWN 0.8 percent to 29,107.09
Tokyo – Nikkei 225: UP 0.3 percent at 23,479.15 (close)
Shanghai – Composite: UP 1.8 percent at 3,030.15 (close)
Hong Kong – Hang Seng: DOWN 0.2 percent at 27,609.16 (close)
Euro/dollar: UP at $1.0796 from $1.0805 at 2200 GMT
Pound/dollar: DOWN at $1.2875 from $1.2920
Euro/pound: UP at 83.84 pence from 83.63
Dollar/yen: UP at 112.67 from 111.37
Brent Crude: UP 0.5 percent at $59.43 per barrel
West Texas Intermediate: UP 1.0 percent at $54.03
Subscribe to: Post Comments (Atom)
NLC suspends planned strike
The Nigerian Labour Congres, on Monday night, confirmed that it will no longer proceed with its nationwide strike planned for
The leadership of the Nigerian Labour Congress and the Trade Union of Nigeria are meeting the representatives of the Federal Government at
The Nigeria Labour Congress has written all its 43 affiliate unions to mobilise for a scheduled industrial action primed to begin on Wednesd...
Governor @RealAARahman has approved the reduction of workdays to three for public servants in the State.
Post a Comment