Wall St Slumps As Virus Cases Surge

By Glenn Dyer | More Articles by Glenn Dyer

The ASX’s 6.7 point pop on Wednesday now looks horribly out of touch as global markets spent the rest of yesterday slip-sliding lower amid a growing focus on the damage the new waves of COVID-19 are doing to economies.

In fact, the ASX is heading for a massive plunge at the opening of 100 points or more after huge losses across the globe, with the plunge on Wall Street capping a miserable day for markets.

The Dow, the S&P 500, and the Nasdaq all lost more than 3% with the losses growing in the final 15 minutes of trading in one of the worst days for months.

At the close the Dow fell 943 points or 3.43%, the S&P 500 lost 3.53% or more than 119 points and the tech heavy Nasdaq slumped over 426 points, or 3.73% ahead of the release in a day’s time of quarterly earnings reports from the companies that have held the market up – Apple, Amazon, Facebook and Alphabet (Google)

95% of companies in the S&P 500 fell, according to data from reporting firms.

The losses saw the S&P 500 down 5.5% in just three days and heading for what could be the biggest weekly slide since the depths of the March sell-off.

In Europe markets again slumped with the Stoxx 600 index losing 2.95% after Tuesday’s big loss. The German and Italian markets shed more than 4% in value in a day, London’s FTSE 100 fell 2.6% and the French market shed more than 3%.

The S&P 500’s 3.53% was its biggest one-day drop since June 11. The Stoxx Europe index tumbled to its lowest level since May. In Britain, the FTSE 100 index fell to its lowest since April.

Germany and then France announced tighter restrictions on bars, clubs, cafes, public gatherings, and other events in an effort to slow the continuing rise in COVID-19 cases. The UK, Italy, and Spain are already under tight lockdowns.

The US is in the midst of a surging second and third waves, with the election campaign compounding the problems as a desperate Donald Trump tries to claw back Joe Biden’s lead.

But more than 71 million Americans have already voted by postal ballot or vote early booths as fears about the virus force people to decide early they way they are voting for the November 3 polls (which cover not only the Presidency, but much of Congress, state and local government and a number of referenda.

Now the ASX futures market has the key index starting down a massive 100 points (at 7am. it was down 80 points at 5.45 am) when trading resumes this morning.

US West Texas Intermediate oil futures fell more than 5% to under $US37 a barrel ($US37,46) and Brent crude futures ended down 4.5% at $US39.71 a barrel.

Gold slumped more than $US32 to $US1,877 an ounce. Copper eased 0.8% to $US3.06 a pound.

The Aussie dollar fell to 70.60 US cents as the greenback rose on safe haven buying. US 10 year bond yields traded around 0.77% after touching a low for the day of 0.76%. The yield ended at 0.79% on Tuesday and was around 0.87% a week or so ago.

The price of iron ore also bounced a touch, rising after several days of losses. The price of 62% Fe fines delivered to northern China rose $US1.74 to $US116.87 a tonne.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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