European stocks and US equity futures fell sharply on Friday, as investor panic over the fallout from the coronavirus crisis continued unabated and investors rushed to safer perceived assets such as than government bonds.
The pan-European Stoxx 600
XX: SXXP
the index slid more than 3% to 368.19, after slipping 1.4% on Thursday. The index should lose more than 2% over the week. The German Dax 30
DX: DAX
3.3% decrease, the French ACC
FR: PX1
lost 3.5% and the FTSE 100 index
United Kingdom: UKX
down 1.8%.
These losses came while Wall Street was ready for another volatile session, with Dow Jones Industrial Average futures
United States: YM00
down more than 600 points, while S&P 500
United States: ES00
forward and Nasdaq-100
United States: NQ00
dropped more than 2% each.
The Japanese yen climbed 0.5% against the dollar, while an abrupt move towards bonds overnight sent the 10-year Treasury yield
BX: TMUBMUSD10Y
at a record level of 0.78%.
“As the bond market rates the Fed against ZIRP [zero interest-rate policy], that worries us in the short term about risk appetite, “said a team of strategists led by Jeremy Hale at Citigroup. The zero interest rate policy implies that central banks are trying to stimulate growth by keeping rates close to zero.
As of Friday, the number of people affected by the virus reached nearly 100,000, with cases declining in Asia but increasing in Europe and the United States, where more than 230 cases were reported.
“In the absence of signs of a slowdown in the epidemic – the United Kingdom, for example, saw its first COVID-19 death on Thursday – investors continue to face an almost unshakable panic, the various rate cuts practiced by the central bank this week only adding to the seriousness of the, “said Connor Campbell, financial analyst at Spreadex, in a note to clients.
Crude Oil Futures
United States: CL00
fell more than 1% as investors awaited the outcome of a meeting of the Conference of the Organization of the Petroleum Exporting Countries and its allies. OPEC has recommended its members and allies to cut production by an additional 1.5 million barrels a day to ease demand hit by the COVID-19 epidemic, but some analysts doubt that non-member Russia will cooperate.
Almost no stock in Europe was in the green. Tesco
UK: TSCO
rose 1.3% after the UK grocer announced that it was launching a price matching campaign against rival Aldi. “This is an aggressive, confident move at a time when Aldi’s sales momentum is gradually under pressure and margins are at an all-time low of 1.75%,” said James Grzinic, analyst at Jefferies.
Prysmian Italy Stocks
IT: PRY
slid more than 10% after the multinational produced more cautious forecasts for 2020 and net profit disappointed.
Head
United Kingdom: ICC
Shares fell nearly 20% in the wake of a 38% drop on Wednesday after disappointing results for the company outsourcing business processes.
Travel-related shares were hit again, the TUI tourism group
United Kingdom: TUI
slide of more than 5% and shares of the low-cost airline Ryanair Holdings
IE: RY4C
slippery by more than 4%.
