Stocks Around the Globe Stagger on Weak Economic Data as Oil Bounces Back
Let’s take a look at what is happening around the world in a market review, as the world continues to manage the global pandemic.
- Asian stock markets fell as economic data further dulled an earlier rise.
- A bounce-back led prices of crude from its previous lows, and the pledge of more funding by the United States government to cushion the effect of its COVID 19-plagued economy.
- Brent crude oil prices jumped 8.5 per cent, but are only just back above $US20 a barrel.
- The U.S. corporate market also saw an unexpected rise in inequities.
Overall markets are still at the brink of collapse if the pandemic continues to hit the depths of the world’s economy.
Data sources say South Korea is the latest economy to be seeing effects of the huge economic hit, due to the coronavirus pandemic, seeing its financial growth plunge to the lowest ever since 2008.
GDP plunged by 1.4 per cent, primarily as a result of falling consumption due to coronavirus sentiments that kept people at home.
An outlook of Japan’s services sector this April revealed a sharp decline in producers manufacturing index, as retailers and wholesalers took a significant hit from the government’s request for its citizens to stay at home, and for shops and offices to close or operate at shorter hours.
The country’s producers manufacturing index fell to 22.8, the lowest ever recorded from surveys since September 2007.
In the stock markets, Australia’s S&P/ASX lost 0.6%, and Japan’s Nikkei climbed up by 0.8%.
Chinese shares, however, dipped after trading higher earlier in the day, with the Shanghai Composite index trading for less at 0.1% after its initial gains.
Oil continued in its gains on signs that manufacturers are now cutting down production to cope with the fall in demand for fuel. The Brent crude went up by 33cents at $20.70 a barrel as at 02.54 GMT after rising by more than 5% on Wednesday.
The US WTI futures went up by 28cents or more than 2%, at $14.06 a barrel. Earlier on Monday, the WTI fell to below minus $40 which rose from fears that buyers won’t be able to take in new deliveries.
S&P 500 futures fell by 0.4%, with the Dow up 2 per cent, S&P 500 adding 2.3 per cent, and Nasdaq rising by 2.8 per cent.
The U.S. House of Representatives clears a $484 billion bill with money for small businesses, hospitals and COVID-19 testing, to battle coronavirus. This is the fourth coronavirus relief measure passed by Congress. The bill is expected to increase the overall financial response by the U.S government to almost $3 Trillion.
In Europe, the stock market has continued to stay afloat after Italy, on Tuesday, survived a major debt trade and speculations have continued to trail that the more relief measures will be provided by Europe’s Central Bank to cushion the effect of the pandemic.
It may take till summer or longer for countries of the European Union to reach an agreement on how to aid economic recovery from the pandemic as major disagreements continue to persist, an official from the union said on Wednesday.
In the exchange market, the U.S. dollar barely had any effect against the Japanese yen at 107.72, but slightly held firm against sensitive currencies of New Zealand and Australia at $0.5941 and $0.6310 respectively.