European and Asian markets lower as COVID-19 cases mount

Kumutha Ramanathan
·Contributor
·3-min read
Commuters travel on a Jubilee line tube train during the morning rush hour, amid the outbreak of the coronavirus disease (COVID-19) in London Britain, October 15, 2020. REUTERS/Hannah McKay     TPX IMAGES OF THE DAY
A new study out of the UK reveals a proportion of people in England with antibodies dropped by more than a quarter over a three month time period. Photo: Hannah McKay/Reuters

European and Asian markets were lower on Tuesday as COVID-19 cases continue mounting around the world and chances of US stimulus deal unlikely before 3 November presidential election.

UK reported 19,000 new cases on Monday, but total over the past week increased. A study from Imperial College London found that a proportion of people in England with antibodies dropped by more than a quarter over three months. This raises concerns about whether people could be re-infected.

The FTSE 100 (^FTSE) was up by 0.3% at around 1:45pm in London. The pan-European STOXX 600 (^STOXX) was up by 0.4%. Germany’s DAX (^GDAXI) slid by 0.4% and France’s CAC 40 (^FCHI) went lower by 1.1%.

Restrictions are further tightening throughout Europe, with France reporting over 250,000 new cases over the last week and nearly 70% of intensive care beds in the Paris region being occupied, according to local authorities.

President Emmanuel Macron will join a defence cabinet meeting later on Tuesday to address the pandemic, which could lead to more restrictions.

The Netherlands passed 300,000 confirmed cases on Monday, and Dutch prime minister Rutte said he will wait for further data before introducing more restrictions.

In Germany, chancellor Angela Merkel convened a task force on Monday, with reports saying she plans a “lockdown light” plan that will see bars, restaurants and public events shut down to reduce the impact of a second wave.

READ MORE: Boots to roll out 12-minute COVID-19 test

In the US, the rolling seven-day COVID-19 case count has reached a new high with over 480,000 cases. This surpasses the high of over 470,000 cases in late July.

With just over a week to go, national polls are tightening for the US presidential race. Former vice-president Joe Biden is leading by as much +9.4% according to a Fivethirtyeight.com’s poll average, but had a larger +10.7% lead on 17 October.

Late on Monday, the Senate also confirmed Amy Coney Barrett to the Supreme Court of the US, giving conservatives a 6-3 majority. The vote was 52-48 and largely along party lines.

A lack of progress on a consensus stimulus plan is also weighing on market sentiment.

“There are only eight days left for the US presidential election and there are still no signs of second stimulus package,” said Naeem Aslam chief market analyst at AvaTrade. “There is no doubt that investors have become a lot more nervous now than before. This is the reason that we experienced an intra-day drop of 900 points for the Dow Jones yesterday.”

Watch: Citi CEO discusses further action the Federal Reserve could take to boost the economy

US markets were mixed in early trading. The S&P 500 (^GSPC) was down 0.1%, the Dow Jones (^DJI) was also lower by 0.2%, and the Nasdaq (^IXIC) was higher by 0.5%.

Asian markets had modest gains and losses amid a Reuters poll predicting that China's economy is expected to grow at its weakest pace in over four decades.

Japan’s Nikkei (^N225) was down 0.04%, Hong Kong’s Hang Seng (^HSI) also ticked lower by 0.5%, China’s Shanghai Composite (000001.SS) was up by 0.1%. The KOSPI (^KOSPI) in South Korea was lower by 0.6%.