Written by Wayne Cole
SYDNEY (Reuters) – Asian stocks plunged on Monday on rising Corona virus cases in Europe and the United States, threatening global outlook as China’s leaders meet to think about the economic future.
The United States has seen an unprecedented number of new COVID-19 cases in the past two days, while France has set up unnecessary case records and declared a state of emergency in Spain.
There has been no clear improvement in the US stimulus package to reduce the futures of the S&P 500 by 0.5% (). EUROSTOXX 50 futures () 0.4% and futures () 0.3% lower.
The broadest index of MSCI’s Asia-Pacific stocks is flat outside Japan (), still well below its recent 31-month high. Japan’s Nikkei () was flat on both sides, while South Korea’s key index lost 0.3% ().
When the country’s leaders met to mark the country’s economic trend for 2021-2025, Chinese blue chips fell 1.1%, balancing growth with reforms amid uncertain global outlook and deep tensions with the United States.
Graphic – Asian Stock Exchanges: https://product.datastream.com/dscharting/gateway.aspx?guid=516bc8cb-b44e-4346-bce3-06590d8e396b&action=REFRESH
A packed week for monetary policy hosts three major central bank meetings. The Bank of Canada and the Bank of Japan are expected to be on fire for now, while the European Central Bank expects inflation and growth to be cautious.
Data released on Thursday predicted that US economic output would rise 31.9% in the third quarter, following a historic second-quarter slump driven by consumer spending.
According to Westback analysts, such a bounce would reduce GDP by 4% at the end of last year, leaving business investment even worse behind.
“In order to fully recover the lost functionality, additional meaningful financial stimulus is necessary,” they argued in a note.
The US presidential election will again be bigger as markets move in the direction of the Democratic president and Congress, which will lead to higher government spending and road borrowing.
That view has risen to 0.8720% since the beginning of June last week
“We have already raised a basic Democrat by 40% to 50% and raised the expectation that Biden will win by 65% to 75%,” analysts in the Northwest markets wrote in a note.
“We see that in our basic case the steep US yield curves and the weaker US dollar may prevail.”
The dollar flattened on Monday after falling widely last week. The euro 18 was below 1.1840 () and its latest low of $ 1.1880, while the dollar was 104.80 yen
It was part of 92.904 (), after falling nearly 1% last week.
In commodity markets, gold was down 0.1% at $ 1,898 an ounce
Oil prices fell further in anticipation of rising Libyan crude supply and demand concerns as corona virus cases continue to rise in the United States and Europe.
Brent crude (65) lost 65 paise to $ 41.12 and the U.S. crude () was down 69 paise to $ 39.16.
(Adjusted to fix S&P500 in this story title)