Asian markets sank Thursday after a meltdown in New York and Europe sparked by France reimposing a nationwide lockdown to battle a new wave of virus infections, with fears other major economies could follow suit.
With sentiment already dampened by US lawmakers’ failure to pass a new stimulus and election uncertainty, the news out of Paris was the last thing investors wanted to hear as the recovery from this year’s global financial rout was already stuttering.
France’s President Emmanuel Macron’s decision to shut down the country for a month came as Germany said it would impose drastic new curbs as experts warned hospitals would soon be overwhelmed.
Oil prices edged up slightly in Asia, having cratered five percent Wednesday on fears that new lockdowns will again hammer demand for the commodity.
And Innes warned: “The return of the ‘sudden stop’ economic nightmare will play a considerable role in the oil market’s mindscapes over the next few weeks, and it is this fear that keeps traders awake at night.”
Traders are keeping an eye on the release of US economic growth data for the third quarter, which is released later in the day, with estimates for a surge of about 30 percent. However, observers point out that that was helped by a multi-trillion-dollar rescue package, which has now run out.
Tokyo – Nikkei 225: DOWN 0.7 percent at 23,261.98 (break)
Hong Kong – Hang Seng: DOWN 1.3 percent at 24,377.02
Shanghai – Composite: DOWN 0.6 percent at 3,249.49
Euro/dollar: UP at $1.1754 from $1.1749 at 2200 GMT
Dollar/yen: UP at 104.44 yen from 104.31 yen
Pound/dollar: UP at $1.2991 from $1.2987
Euro/pound: DOWN at 90.43 pence from 90.45 pence
West Texas Intermediate: UP 0.6 percent at $37.62 per barrel
Brent North Sea crude: UP 0.6 percent at $39.36 per barrel
New York – Dow: DOWN 3.4 percent at 26,519.95 (close)
London – FTSE 100: DOWN 2.6 percent at 5,582.80 (close)
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