Stocks fell in most of world with US futures, dollar rises

Bloomberg

Stocks fell in most of the world while US index futures edged lower in a sign the risk-off move that hit markets at the start of this month may have further to run. The dollar climbed.
The Stoxx Europe 600 slumped at the open, with all 19 industry sectors down. Contracts on the three main American indexes traded in the red during the entire Asia session, before paring some of their declines. Shares in Hong Kong saw the bulk of losses in Asia, followed by markets in Seoul and Singapore, though volumes were light due to holidays in China and Japan.
China’s yuan held Friday’s slide in offshore trading amid concern tensions with the US are increasing. Treasuries drifted, while most European bonds edged lower. Oil slipped, with WTI futures declining more than Brent contracts.
Global stocks begin the week declining for a third straight session, a streak not seen in almost two months, as US-China discord flared again and North and South Korea exchanged fire at their border. Investors are also assessing efforts from countries starting to ease lockdown restrictions against fears of a second wave of infections and a steady stream of bad economic data. Earnings roll on this week, with firms including Disney, BMW, and Air France-KLM scheduled to report.
“My concern is that the market has priced in all that optimism before we have confronted the worst of the bad news on the economy and on some industries and earnings,” Michael Jones, chief executive officer at Caravel Concepts LLC, said on Bloomberg TV. “There are some challenges and setbacks that are going to be hitting us in the face over the next four weeks and we are no longer priced cheaply enough to just look past all that bad news.”
US Secretary of State Michael Pompeo said “enormous evidence” shows the novel coronavirus outbreak began in a laboratory in Wuhan, China, but didn’t provide any proof for his claims. That comes after President Donald Trump and his aides last week sharpened their criticism of Beijing, demanding answers about the virus’s origin and hinting at possible retaliation.
Gilead Sciences Inc. plans to get its drug remdesivir to patients within days after getting US backing for emergency use. New York added the fewest new deaths in more than a month, while fatalities slowed in the UK and Italy.
Meanwhile, North Korean troops fired at their South Korean counterparts in the demilitarized zone that divides the two countries for the first time in years. The move came a day after Kim Jong Un resurfaced at a fertilizer factory, ending weeks of speculation about his whereabouts.
Friday brings the US jobs report for April, expected to show severe impact from the pandemic. The median forecast in a Bloomberg survey of economists calls for a 21 million plunge in payrolls.
The Stoxx Europe 600 Index tumbled 2.5% as of 8:20 am London time and the futures on the S&P 500 Index fell 0.8%. While France’s CAC 40 Index slumped 3.7%, Hong Kong’s Hang Seng Index sank 4%.
The Bloomberg Dollar Spot Index jumped 0.4% and the euro dipped 0.4% to $1.0935.
While British pound declined 0.5% to $1.2445, the Japanese yen strengthened 0.1% to 106.78 per dollar and the South Korean Won weakened 0.7% to 1,229.04 per dollar.
The yield on 10-year Treasuries fell one basis point to 0.60% and Germany’s 10-year yield climbed two basis points to -0.56%. While Britain’s 10-year yield decreased one basis point to 0.237%, the spread of Spain’s 10-year bonds over Germany’s increased two basis points to 1.331 percentage points.
West Texas Intermediate crude fell 6.9% to $18.42 a barrel and Brent crude fell 1.7% to $25.99 a barrel. Gold strengthened 0.3% to $1,705.57 an ounce.