World shares turn lower as virus caseloads surge

MITO, JAPAN (AP) – World shares were mostly lower yesterday on renewed worries over surging coronavirus caseloads in many countries.

United States (US) futures also edged lower, though US 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 per cent to 13,117.16 and the CAC 40 in Paris lost 0.8 per cent to 3,075.15. Britain’s FTSE 100 skidded 0.8 per cent to 6,216.99. US futures were little changed, with the contract for the S&P 500 down 0.2 per cent while the Dow industrials future edged 0.1 per cent lower.

Hong Kong’s Hang Seng index tumbled two per cent, to 25,131.50, after its health minister warned the city is at a high risk of an “outbreak in the community”. Authorities made wearing of masks on public transport and in public indoor areas as the number of confirmed cases pushed past 2,000.

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 per cent to 6,075.10.

A woman wearing a face mask walks past an electronic stock board showing Japan’s Nikkei 225 index at a securities firm in Tokyo. PHOTO: AP

Tokyo’s Nikkei 225 index lost 0.6 per cent to 22,751.61. The Shanghai Composite index gained 0.2 per cent to 3,328.68.

Adding to unease was a report by the US 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.

Uncertainty over prospects for more financial aid to Americans and US businesses also is casting a shadow, analysts said. The Republican Party and Democrats remain divided over how much support is needed, as states grapple with rebounds in cases that have prompted some local governments to order some businesses to close to help snuff out flare ups of the virus.

“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 US economy,” Jingyi Pan of IG said in a commentary.

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.

“I do not understand why the market is fretting about the US stimulus plan,” said Stephen Innes of AxiCorp. Delays are to be expected given the “slow bipartisan tango that always seems to happen around these events.

But at the end of the day, no one and I mean no lawmaker, especially in an election year, want to wear the Scarlet Letter and be accused of being frugal when people are dying across the US Sunbelt at record levels,” Innes said.

Among big companies reporting results this week: Microsoft and Tesla issue results yesterday, Intel, AT&T and Twitter report today and Verizon Communications and American Express report earnings tomorrow.

The yield on the 10-year Treasury was steady at 0.60 per cent after slipping to 0.59 per cent late Tuesday. The yield is a benchmark for interest rates on mortgages and other consumer loans.

In the commodities markets, the price of benchmark US oil dropped 36 cents to USD41.56 per barrel in electronic trading on the New York Mercantile Exchange. It jumped 2.8 per cent to settle at USD41.92 a barrel on Tuesday. Brent crude oil, the international standard, lost 31 cents to USD44.01 per barrel.

The US dollar rose to JPY106.92 from JPY106.79 late Tuesday. The euro was trading at USD1.1520, down from USD1.1528.