Stock Sell-Off Deepens, Bond Yields at Record Lows: Markets Wrap - Yahoo Finance

Stock Sell-Off Deepens, Bond Yields at Record Lows: Markets Wrap

(Bloomberg) -- Global stocks, government bond yields and oil extended their declines, as anxiety over the spread of the coronavirus surges.

Futures on the main U.S. gauges extended declines as the New York open approached. The MSCI All-Country World Index fell for a sixth day, while the Stoxx Europe 600 entered a correction phase. Goldman Sachs strategists wrote that they expect no profit growth for U.S. companies in 2020 as they update their earnings model to incorporate the likelihood that the virus becomes widespread.

“The way the market is going down, it’s happening pretty quickly, but it’s very difficult to say that it’s over,” said Sameer Samana, senior global market strategist for Wells Fargo Investment Institute. “Bottoming is a multi-step process and you’re probably still in step one.”

Haven assets continued to be in demand, and the yen strengthened as yields on 10-year U.S. and Australian government bonds hit fresh record lows. Oil sank further. The pound reversed a gain after the U.K. told the European Union it could walk away from the negotiating table in June if progress isn’t being made toward a trade deal.

Investors are pricing in a Federal Reserve easing in April followed by another full rate cut in July, swaps data show, while bets for easing from Japan to Australia have also increased after the International Monetary Fund cut global growth forecasts.

Losses continue to mount as investors weigh each gloomy headline on the virus. U.S. health authorities on Wednesday said they found the first case of the illness that does not have ties to a known outbreak. Microsoft Corp. joined an expanding list of companies warning over the impact of the virus on operations.

“The fact that, not only is there no sign yet of the pathogen being contained, but rather we now also face the specter of it spreading through the U.S., will continue to weigh on the global macro outlook for the coming months,” Simon Ballard, chief economist at First Abu Dhabi Bank, wrote in a note. “Buckle up for continued high volatility and escalating risk aversion.”

Here are some key events still to come this week:

Earnings keep rolling in from companies including: Baidu Inc., Occidental Petroleum Corp. and Dell Technologies Inc. on Thursday after the close of U.S. trading, and London Stock Exchange Group Plc on Friday.Japan industrial production, jobs, and retail sales figures are due on Friday.

These are the major moves in markets:

Stocks

Futures on the S&P 500 Index dipped 1.7% as of 9:11 a.m. New York time.The Stoxx Europe 600 Index fell 3.2%.The U.K.’s FTSE 100 Index declined 2.5%.

Currencies

The Bloomberg Dollar Spot Index fell 0.2%.The British pound dipped 0.1% to $1.2893.The Japanese yen strengthened 0.5% to 109.90 per dollar.The offshore yuan strengthened 0.2% to 7.0089 per dollar.

Bonds

The yield on 10-year Treasuries fell six basis points to 1.27%.Germany’s 10-year yield dipped three basis points to -0.53%.Britain’s 10-year yield fell four basis points to 0.461%.

Commodities

Gold strengthened 0.7% to $1,652.24 an ounce.West Texas Intermediate crude declined 3% to $47.28 a barrel.

--With assistance from Katherine Greifeld.

To contact the reporters on this story: Vildana Hajric in New York at vhajric1@bloomberg.net;Sam Potter in London at spotter33@bloomberg.net

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Dave Liedtka

For more articles like this, please visit us at bloomberg.com

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https://finance.yahoo.com/news/asia-stocks-head-cautious-start-231215317.html

2020-02-27 14:11:00Z
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