(Bloomberg) — U.S. stock index futures dropped alongside shares in Europe and Asia as worries over a potential second wave of Covid-19 led to deepening concerns over the global economy.
Contracts on the S&P 500 declined 3% as of 8:27 a.m. in London. Futures on the Nasdaq 100 Index and Dow Jones Industrial Average fell 2.4% and 3%, respectively. On Friday, U.S. stocks rallied from the biggest rout in 12 weeks as dip-buyers emerged for firms that bore the brunt of Thursday’s selling.
“Despite Wall Street stabilizing and finishing the week with a positive session, it appears that the FOMO, fast-money, peak-virus, buy-everything, v-shaped recovery herd remains nervously grazing near the edge of the cliff,” Jeffrey Halley, senior market analyst for Asia Pacific at Oanda, wrote in a note.
The Stoxx Europe 600 Index tumbled 2.5%, with cyclical sectors such as miners and oil leading the declines. Equity indexes in Japan, Hong Kong, China, Taiwan and South Korea all fell.
An outbreak of cases in Beijing raised fears of a resurgence of the pandemic in China. Infections spread to a second fruit and vegetable market and more than 20 residential compounds across the city were locked down. Tokyo also saw infections climb, and South Africa posted record new cases for a second day. Infectious disease expert Anthony Fauci suggested that bans on travel to the U.S. may remain until a vaccine arrives.
While U.S. stocks recovered Friday, all three major equity gauges fell for the week on concern over the pace of recovery following months of lockdown.
The potential for a second wave of infections “appears to be a much more immediate danger to markets,” said Michael McCarthy, chief market strategist at CMC Markets Asia Pacific.
bloomberg.com” data-reactid=”26″>For more articles like this, please visit us at bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.” data-reactid=”27″>Subscribe now to stay ahead with the most trusted business news source.
©2020 Bloomberg L.P.