Volatile Stock Market Indices Amid COVID Fears and China-US Tensions


With over 18 million infections in the world, the coronavirus returns to scare and there is already talk of a probable second wave, in the autumn. Added to this are the fears of millions of US families, who risk no longer seeing those fiscal aid ($ 600 a week) implemented at the onset of the Covid-19 emergency and expired at the end of July: discussions within Congress Uses are still ongoing.

How did the day end in Asia?

The pan-Asian MSCI index excluding Japan in the morning peaked for six months, only to retrace earnings after the drops suffered by the China and Hong Kong stock exchanges.

Chinese equities closed in contrast with only Shanghai positive (+ 0.26%), while Shenzhen and China A50 lost 0.72% and 0.27% respectively. The same goes for the Hang Seng, which currently leaves 0.67% on the ground.

Japan also fell , where the Nikkei lost 0.43% and the Topix 0.31%; among the positives, the Korean Kospi stands out, gaining 1.33% at the close. What worries the Tokyo Stock Exchange is above all the difficulty of the US Congress in finding a compromise on fiscal stimuli in an anti-covid key and the consequences on the dollar , which already last week created difficulties in terms of prices for imports and exports.

A pull down China are the geopolitical tensions with the United States , heaped even on technology companies: the war waged by the US president Donald Trump to popular Chinese app TikTok also impacts on big industry, such as Alibaba, and overall sentiment market.

What are the US markets expecting today?

Dollar still under pressure due to the slow pace of work in the US Congress . On the one hand, the Democrats, absolutely determined to keep the figure at $ 600 a week for families who are suffering the effects of the economic crisis resulting from Covid-19; on the other, the Republicans, who, on the contrary, are trying to lower the budget.

In the meantime, data on the employment situation in the United States are expected between today and tomorrow : today it’s the turn of the weekly requests for unemployment benefits , while tomorrow the data will be released on the payslips in the non-agricultural sector in July, a litmus test of the conditions US economy – 4.8 million new jobs were created in June, a record recovery, while the unemployment rate stood at 11.1%: never so high and, at the same time, never so high strong recovery, compared to the peak of 14.7% recorded in April.

On the currency front, the euro-dollar exchange rate is still at its highest since 2018, at 1.1864, while the USD / JPY rate marks 105.547. The pound jumped, with GBP / USD at 1.3161 (+ 0.35%) after the Bank of England interest rate decision .

Gold is now over $ 2,000 an ounce (2,047) and oil also sees a sharp rise, with WTI at $ 42.31 and Brent at $ 45.38 a barrel.

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What does the day look like in Europe today?

Weak openness for European equities, which however turn almost immediately upwards except for London: the Ftse 100 travels below the 0.75% parity after the bad economic forecasts of the BoE which, in addition to leaving the interest rate on the Sterling unchanged at 0.1%, it also predicted a slower-than-expected recovery for the British economy from the coronavirus crisis.

The rest of the continental indices were volatile, especially the Dax (+ 0.69%) thanks to macro data on orders to factories in June, up by 27.9% compared to the previous month. Paris moves on parity while Madrid loses 0.24%.

Piazza Affari is also looking for a direction, which after trying to stay above par for the first hour of trading drops to -0.27%, driven downwards especially by bad quarterly accounts : Pirelli collapses to -4.74 % (3.52 euros per share), Tenaris -4.25% to 5.18 euros, Unicredit also hurt (-1.15% to 7.98 euros) which, despite higher than expected profits in the last three months (420 million euros) closed the half-year in the red of 2.3 billion.