The Thursday Market Minute
- Global stocks retreat as China reports a 15,000 spike in new coronavirus cases using comptuerized detection methods.
- CT scans reveal 14,800 new infections in Hubei province, taking the national total just over 60,000.
- WHO DG Tedros Adhanom Ghebreyesus warns outbreak "could still go in any direction", although non-China deaths linked to COVID-19 remain very low.
- Asia stocks slide as case confirmations increase, and China notes its ongoing slump in new car sales in the world's biggest auto market.
- European stocks slide even as the euro hits a multi-year low of 1.0879 against the U.S. dollar as investors avoid risk markets.
- U.S. equity futures suggest a pullback from record highs on Wall Street at the opening bell ahead of earnings from PepsiCo and Kraft Heinz before the start of trading.
U.S. equity futures tumbled lower Thursday, while stocks traded red in major markets around the world, as China reported a 15,000 spike in new coronavirus cases using a new detection method, adding to concerns that the spread of the deadly virus is yet to be contained.
Health officials using computerized tomography techniques have confirmed nearly 15,000 new cases of the virus - now known as COVID-19 -- in Hubei province, where the disease was first identified from an illegal wildlife market in the central industrial city of Wuhan. That takes the provincial total to just under 50,000 and the nation-wide total to around 60,000.
Investors and health officials have thus far taken solace in the fact that only two of the 1,350 confirmed deaths from COVID-19 have taken place outside of China, but with new detection methods unveiling a raft of new case, and WHO Director General Tedros Adhanom Ghebreyesus warning the outbreak "could still go in any direction", caution has replaced optimism heading into the close of the week.
U.S. equity futures are reflecting that concern, with contracts tied to the Dow Jones Industrial Average indicating a 225 point pull back from last night's record close of 29,551.42 points. Those linked to broader S&P 500, which also ended yesterday's session at a fresh all-time high of 3,379.45 points, are guiding to a 25 point retreat. Nasdaq Composite futures are indicating a 92 point decline for the tech-focused benchmark.
Benchmark 10-year U.S. Treasury bond yields, in the meantime, have retraced much of their two-day gains to trade at 1.581% in early European deal amid the market's defensive tone, while the U.S. dollar index extended gains to a fresh four-month high of 99.01 against a basket of its global peers.
European stocks were also retreating from record highs at the start of trading Thursday, with the Stoxx 600 falling 1% even as the euro held at a 2017 low of 1.0880 against the firming U.S. dollar. Britain's FTSE 100, meanwhile, slumped 1.5% in London, lead to the downside by basic resource and energy stocks.
Barclays Plc (BCS) - Get Report shares were an early mover of note in the European market, falling nearly 2% in London trading after the bank said its CEO, Jes Staley, is being investigated by Britain's financial watchdogs over his relationship with the disgraced U.S. financier Jeffrey Epstein.
Overnight in Asia, the worrying spike in new COVID-19 confirmations clipped gains for regional stocks, with investors also expressing concern for the fate of China's staggering economy, where new car sales fell for the 19th consecutive month, according to industry forecasts from the China Association of Automobile Manufacturers, as production remains shuttered throughout the country.
The MSCI ex-Japan benchmark slipped 0.2% lower heading into the close of trading, while a firmer yen hit export-focused stocks on the Nikkei 225 in Japan, sending the index 0.14% lower to a 23,827.73 point close.
Global oil prices were also in the red, paring gains from last night's 3% rally that was largely built on hopes that COVID-19 cases in China had peaked, with traders also citing yesterday's bigger-than-expected buildup in domestic crude stocks of 7.5 million barrels, as well as global demand cuts from both the Energy Department and OPEC on Tuesday and Wednesday respectively.
Brent crude futures contracts for April delivery, the global benchmark for pricing, were last see seen 58 cents lower from their Wednesday close in New York and trading at $55.21 per barrel, while WTI contracts for the same month were seen 41 cents lower at $50.76 per barrel.