LONDON (Reuters) – Global stocks fell for the third day in a row and oil fell on Thursday, following weaknesses in Asia and Wall Street as the expansion of COVID-19 restrictions weighed on market sentiment.
Positive news about potential vaccines helped lift the MSCI global index to record highs earlier this week, only for investors to withdraw after a number of countries announced record infection rates and tighter blockades.
Weaker sentiment was triggered by a late sell-off in the United States, in which the S&P 500 closed 1.1% after news that COVID-19 deaths in the world’s largest economy had passed 250,000, based on multiple blockades.
Similarly, the gloomy news in Japan, which saw a record number of cases and a rise in the level of warning of a pandemic in Tokyo, lowered the Nikkei by 0.4%. MSCI’s broadest Asia-Pacific equity index outside Japan fell 0.8 percent.
“Markets are probably outpacing vaccine news and are probably just withdrawing now because the number of cases is increasing,” said Gavin Rohusen, chief executive of UK-based asset manager Polar Capital.
“The vaccine will take time to deliver, be administered, and so on, and I think what’s happening is that the markets realize that … it’s not just the silver bullet, it’s going to take time.”
The positive news about the vaccine continued yesterday, after Pfizer said that its vaccine COVID-19 is 95% effective and will apply for an emergency permit in the United States within days after a similar recent report by Moderna.
Wall Street futures are offering to come further, with 0.3%, with all eyes on the US Federal Reserve for signs it can take with new monetary incentives – something two employees nodded on Wednesday.
Investors will also expect US job data at 1330 GMT.
Against a basket of currencies, the dollar last reached 92,621, close to its weekly opening. The euro / dollar fell 0.2% to last trade at $ 1.1827.
“Vaccine news is a positive medium-term impetus for the global economic outlook, and investors are trying to assess this against the prospect of halting the recovery of Europe and the United States soon amid the prospect of extending current blocking measures,” said Rodrigo Catril, senior currency strategist. in NAB.
Sterling weakened by 0.4% against the dollar and 0.2% against the euro, according to a report, European leaders will ask the European Commission to publish plans for no Brexit deals, as the deadline for trade talks will be reduced.
Despite caution in the stock market, gold traders continued to look at the longer term, betting that COVID-19 vaccines would lead to a faster economic recovery. This sent the precious metal to a week-long bottom.
Bitcoin, sometimes considered a safe haven or at least a hedge against inflation, also receded to $ 17,599.
Further reporting by Thyagaraju Adinarayan in London; Edited by Catherine Evans