Shares, Oil Prices Sink After Trump Tests Positive for Virus

Shares, Oil Prices Sink After Trump Tests Positive for Virus

  • Post author:
  • Post category:News
  • Post comments:0 Comments

U.S. stock futures and Asian shares fell Friday after President Donald Trump said he and first lady Melania Trump had tested positive for the new coronavirus.

The future contracts for both the S&P 500 and the Dow industrials lost 1.9 percent. Oil prices also slipped.


What You Need To Know

  • President Trump Tweeted Friday that he and the first lady both tested positive for the coronavirus
  • U.S. stock futures and Asian shares fell shorltly after President Trump’s positive test results were made public
  • Such big swings have become typical recently, as investors handicap the chances of a deal on Capitol Hill to send more cash to Americans
  • The dollar weakened to 105.05 Japanese yen from 105.54 yen. The euro weakened to $1.1731 from $1.1747

Trump tweeted news of his test results just hours after the White House announced that senior aide Hope Hicks had come down with the virus after traveling with the president several times this week.

“To say this potentially could be a big deal is an understatement,” Rabobank said in a commentary. “Anyway, everything now takes a backseat to the latest incredible twist in this US election campaign.”

Trading in Asia was thin, with markets in Shanghai and Hong Kong closed. The Nikkei 225 index shed strong early gains, losing 0.8 percent to 22,999.75 after the Tokyo Stock Exchange resumed trading following an all-day outage due to a technical failure.

Reports that the Japanese government is preparing new stimulus measures to help the economy recover from a prolonged downturn worsened by the coronavirus pandemic provided only a temporary lift. Prices fell further after Trump’s announcement.

Australia’s benchmark S&P/ASX 200 slipped 1 percent to 5,815.90. Shares in Singapore, Thailand and Indonesia also fell.

On Thursday, the benchmark S&P 500 ended the day 0.5 percent higher, at 3,380.80, the Dow Jones Industrial Average rose 0.1 percent to 27,816.90 and the Nasdaq composite rose 1.4 percent to 11,326.51, as big tech-oriented stocks propped up the market, much as they have through the pandemic.

Such big swings have become typical recently, as investors handicap the chances of a deal on Capitol Hill to send more cash to Americans, restore jobless benefits for laid-off workers and deliver assistance to airlines and other industries hit particularly hard by the pandemic.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued their talks on Thursday, but no breakthrough arrived before stock trading ended on Wall Street. Instead, there were only hopes that were periodically raised and dashed as government officials took turns criticizing each other.

“Things remain fluid; we all know what is at stake if this deal does not go through before markets sundown, it is unlikely to be pretty ugly,” Stephen Innes of Axi said in a commentary.

Beyond potential political developments, investors will be watching for job figures due out Friday. Data released Thursday painted a mixed picture for the economy, with one report showing the number of workers filing for unemployment benefits last week fell to 837,000 from 873,000. That was less than economists expected, but incredibly high compared with before the pandemic.

Consumer spending was higher than forecast in August, which is key because it’s the main driver of the U.S. economy. But personal incomes weakened by more than expected last month, and growth in the country’s manufacturing sector also fell short of forecasts.

With airlines and other major companies announcing layoffs and furloughs, another round of economic aid from Congress is seen as crucial. Treasury Secretary Stephen Mnuchin and House Speaker Nancy Pelosi have worked effectively together in the past, helping to drive through the previous economic rescue approved by Congress in March. But the country’s deepening partisan divide has stymied progress, with the presidential election only about a month away.

The yield on the 10-year Treasury fell to 0.66 percent from 0.67 percent late Thursday.

U.S. benchmark crude lost $1.08 to $37.64 per barrel in electronic trading on the New York Mercantile Exchange. It gave up $1.50 to $38.72 on Thursday. Brent crude, the international standard, lost $1.05 to $39.88 per barrel.

The dollar weakened to 105.05 Japanese yen from 105.54 yen. The euro weakened to $1.1731 from $1.1747.

Leave a Reply