Coronavirus: Second wave fears spark sharp sell-off for global stocks

A new outbreak was noted at the weekend in Beijing as stocks around the world sold out heavily on Monday. (Andy Wong / AP Photo)
Stocks around the world sold out on Monday as fears of a recurrence of COVID-19 infections around the world dampened risk appetite.
The FTSE 100 (^ FTSE) opened 2.1% in London, while the DAX (^ GDAXI) in Frankfurt fell 2.8% and the CAC 40 (^ FCHI) in Paris fell 2.4%.
US futures indicated a strong sell-off when stock markets opened in New York today. S&P 500 futures (ES = F) fell 2.8%, Dow Jones futures (YM = F) fell 3.2% and Nasdaq futures (NQ = F) fell 2.1%.
The Asian markets closed largely lower overnight. The Japanese Nikkei (^ N225) lost 3.4% and the Hong Kong Hang Seng (^ HSI) fell 2.1%. On the Chinese mainland, the Shanghai Composite (000001.SS) fell by 1% and the Shenzen Component (399001.SZ) by 0.5%.
Analysts said the sellout was partly due to concerns about rising COVID-19 cases worldwide.
“Stock markets start the week under pressure from weaker-than-expected Chinese retail sales and industrial production. [And] there is still evidence of a second wave of COVID-19 in some parts of the emerging markets and the sun belt in the US, either through mismanagement. like in Brazil or when the economy reopened, ”said Sebastien Galy, senior macro strategist at Norwegian Bank Nordea.
California, Texas, Florida and Arizona continue to fight severe outbreaks in the United States. At the weekend, a new outbreak was found in Beijing, which is said to have originated in a food market. In response, China has introduced localized restrictions.
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"There were headlines in China on Sundays in which the number of new cases has increased the most since April and a market in Beijing is very heavily closed," wrote strategist Jim Reid and his team from Deutsche Bank in a message to the Monday morning Customers. “With 57 new cases in a country with 1.4 billion inhabitants, we have to put this into perspective.
“This rounded off the 1-day growth of new cases after 62 days of growth from 0.0% to 0.1%. A further 49 cases were reported overnight, with Beijing closing residential areas in and around the market in focus. "
There are now 7.9 million cases of COVID-19 worldwide, with the moving 7-day average in new cases every day reaching an all-time high in the latest management report from the World Health Organization (WHO).
The sell-off on the stock markets on Monday follows a volatile session on Friday and a strong sell-off on Thursday last week.
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