Global stock markets fall due to concerns about Delta Covid variants
European and Asian stock markets and oil prices fell, while government bonds rose, as the new Covid-19 outbreak cast a shadow over the global economic outlook.
The Stoxx Europe 600 Index fell 1.7%, and the FTSE 100 Index fell 1.9%. Japan’s Topix Index fell 1.3%, while Hong Kong’s Hang Seng Index fell 1.7%.
As investors seek safe assets, government bonds continued their recent gains, pushing yields to multi-month lows. The 10-year U.S. Treasury bond yield hit 1.252% on Monday, the lowest level since mid-February. The yield on German 10-year government bonds fell to minus 0.37%, the lowest level since early March.
International oil benchmark Brent crude oil fell 2.7% to US$71.60 per barrel, as economic growth concerns exacerbated earlier declines OPEC and its allies reach an agreementl Increase production to cope with rising prices.
These moves come as investors are struggling to deal with the rapid spread of Covid-19’s highly contagious variant of Delta, which has already hit countries that previously controlled the virus.
On Saturday, New York State recorded more than 1,000 cases in a single day for the first time since mid-May. Authorities in countries such as Australia and Vietnam are fighting rising infections, Singapore tightening social distancing restrictions, and the Tokyo Olympics Back off Due to the coronavirus outbreak.
The futures market hinted that the S&P 500 on Wall Street would fall 0.8% in early New York trading.
The Stoxx Index and the U.S. Standard & Poor’s 500 Index reached record highs earlier this month due to the high level of enthusiasm for the coronavirus vaccine and the benefits of businesses from the reopening of the economy.
Ewout van Schaick, director of multi-asset investment at NN Investment Partners, said: “Valuation and sentiment have reached extreme growth highs.” “Now, of course, the virus recovery is causing uncertainty about economic progress in the coming months.”
The U.S. dollar index, which measures the U.S. dollar against major currencies, rose 0.3%, and tends to rise in times of stress.
The pound fell 0.4% against the dollar to $1.37, a three-month low.United Kingdom lift Most of the coronavirus restrictions were implemented on Monday, and more than 500,000 people, including Prime Minister Boris Johnson, were told to quarantine after coming into contact with infected people. Retailers and ports reported shortages.
Stoxx’s tourism industry fell 2.6% due to sharp declines in stocks in tourism-dependent economies. Italy’s FTSE MIB index fell 2.1%, and Spain’s Ibex index fell 1.5%.
After U.S. stocks close on Friday Worst weekly performance More than a month later, the futures market signaled that the S&P 500 index would fall by 0.5% in early trading.
Michael Hood, a global multi-asset strategist at JP Morgan Asset Management, said that the rapid spread of Delta variants “forces investors to refocus on the virus, and at this time most people are happy to leave this issue behind.”
After rising consumer prices in the United States and the United Kingdom, the market is also weighing how monetary policy makers will respond to rising inflation Accidental acceleration In June.
In response to inflationary trends, the Fed is under pressure to reduce its monthly bond purchases of US$120 billion promote The Bank of England controls its own government bond purchases.
Additional report by Tommy Stubbington in London