US index futures tumble after Trump tests positive for COVID-19 - BNN

U.S. futures fell with European stocks on Friday and the dollar rose after President Donald Trump said he had tested positive for the coronavirus.

Trump said both he and First Lady Melania Trump have contracted the virus and will now quarantine themselves, adding to uncertainty in the runup to the U.S. presidential elections next month. S&P 500 futures fell as much as 2 per cent, though they pared some of the drop as traders reassessed both candidates’ chances. The yen and Treasuries, often seen as havens in times of market stress, rose. Crude oil extended losses.

The White House already announced that Trump was canceling all public events, including a rally in Florida, on Friday. Normal virus protocols could keep him off the campaign trail at least 10 days and possibly longer at a critical moment when he is trying to gain ground on Joe Biden, who polls show is holding steady with about a 7 percentage-point lead nationally.

“Market sentiment was already delicately balanced ahead of the November election, and the news only adds to the uncertainty,” said Karen Ward, chief market strategist for EMEA at J.P. Morgan Asset Management. Still, “with such a wide range of outcomes and implications stemming from the President’s diagnosis, it’s too soon to ascertain what the final market direction will be,” she said.

Trump’s diagnosis adds to gloomy developments around the virus as big cities once again turn into hotspots. New York reported the most new cases since May, while London is said to be at a “tipping point” with infections continuing to rise. Monthly U.S. payrolls data later Friday will offer further clues on the enduring economic toll. Thousands of job cuts this week showed how firms are still wrestling with readjustments needed to survive.

Meanwhile, hopes of further fiscal measures are fading. The House of Representatives passed a US$2.2 trillion Democrat-only stimulus package that Republicans reject.

In Europe, precious metals miner Centamin plunged as much as 20 per cent after reducing its 2020 production guidance. The pound reversed a loss on news U.K. Prime Minister Boris Johnson will intervene in the Brexit negotiations for the first time since June when he holds talks with his European counterpart on Saturday.

These are the main moves in markets:

Stocks

Futures on the S&P 500 Index sank 1.9 per cent as of 6:21 a.m. New York time.
The Stoxx Europe 600 Index fell 0.8 per cent.
The MSCI Asia Pacific Index dipped 0.3 per cent.
The MSCI Emerging Market Index dipped 0.2 per cent.

Currencies

The Bloomberg Dollar Spot Index increased 0.2 per cent.
The euro declined 0.3 per cent to US$1.1712.
The British pound increased 0.2 per cent to US$1.2919.
The onshore yuan strengthened 0.2 per cent to 6.799 per dollar.
The Japanese yen strengthened 0.4 per cent to 105.13 per dollar.

Bonds

The yield on 10-year Treasuries sank two basis points to 0.66 per cent.
The yield on two-year Treasuries declined less than one basis point to 0.12 per cent.
Germany’s 10-year yield fell one basis point to -0.55 per cent.
Britain’s 10-year yield decreased less than one basis point to 0.23 per cent.
Japan’s 10-year yield gained one basis point to 0.022 per cent.

Commodities

West Texas Intermediate crude sank 4.8 per cent to US$36.85 a barrel.
Brent crude sank 4.7 per cent to US$39.02 a barrel.
Gold strengthened 0.1 per cent to US$1,907.25 an ounce.

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2020-10-02 10:52:16Z
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