Stocks sag on concerns about Covid, global growth

NEW YORK -- Global stocks mostly fell Friday as worries about rising Covid-19 cases and their effect on global growth weighed on sentiment, pushing Wall Street into the red for the week.

After data showed an unexpected rise in US retail sales, Wall Street pushed higher at the open. But markets soon tumbled into the red and losses grew as the day progressed.

Analysts pointed to profit taking as a factor in Friday's session and throughout the week following records earlier in the month. 

Investors are "continuing to trim winning positions" as they await more clarity on the course of the economy, said Briefing.com analyst Patrick O'Hare.

The broad-based S&P 500 ended down 0.8 percent at 4,327.16, taking its weekly losses to around one percent.

The highly-contagious Delta variant has led to surging infection rates in many parts of the world, leading authorities to reimpose certain restrictions.

"Covid-19 concerns still linger and the economic outlook is not as bright as it was just a few weeks ago," said market analyst Edward Moya at trading platform Oanda.

Major European bourses retreated, along with Tokyo, which closed one percent lower as investors worried over rising Covid-19 infections and the Bank of Japan trimmed its economic growth forecast for the current fiscal year.

Hong Kong's leading index was flat as late profit-taking wiped out earlier gains ahead of a US warning about doing business in the territory.

In a long-awaited advisory that has already been denounced by China, the United States warned its business community of "growing risks" of operating in Hong Kong due to China's clampdown.

The advisory acknowledged that Hong Kong, a former British colony handed back to China in 1997, "retains many economic distinctions" from the mainland, including stronger protections of intellectual property.

But Washington pointed to a declining climate under a national security law enacted last year, including the arrest of one US citizen -- John Clancey, a prominent human rights lawyer.

Shanghai closed 0.7 percent lower while Seoul, Taipei, Kuala Lumpur and Bangkok also retreated. Wellington was flat while Sydney, Singapore, and Jakarta ticked higher.

- Key figures around 2030 GMT -

New York - Dow: DOWN 0.9 percent at 34,687.85 (close)

New York - S&P 500: DOWN 0.8 percent at 4,327.16 (close)

New York - Nasdaq: DOWN 0.8 percent at 14,427.24 (close)

London - FTSE 100: DOWN less than 0.1 percent at 7,008.09 (close)

Frankfurt - DAX 30: DOWN 0.6 percent at 15,540.31 (close)

Paris - CAC 40: DOWN 0.5 percent at 6,460.08 (close)

EURO STOXX 50: DOWN 0.5 percent at 4,035.77 (close)

Tokyo - Nikkei 225: DOWN 1.0 percent at 28,003.08 (close)

Hong Kong - Hang Seng Index: FLAT at 28,004.68 (close)

Shanghai - Composite: DOWN 0.7 percent at 3,539.30 (close)

Euro/dollar: DOWN at $1.1809 from $1.1812 at 2100 GMT Thursday

Pound/dollar: DOWN at $1.3765 from $1.3829

Euro/pound: UP at 85.77 from 85.42 pence

Dollar/yen: UP at 110.04 from 109.83 yen

Brent North Sea crude: UP 0.2 percent at $73.59 per barrel

West Texas Intermediate: UP 0.2 percent at $71.81 per barrel

Agence France-Presse

Global stocks fall, oil dips as Japan slips into recession

LONDON - Shares fell and the oil price slid on Monday after data showed Japan had slipped into recession, raising concerns about global growth.

European shares opened lower. They followed Tokyo's Nikkei index which lost 3 percent, its biggest one-day drop since August on news that the world's third-largest economy unexpectedly shrank by an annualised 1.6 percent in the third quarter.

This followed a 7.3 percent contraction in the previous quarter caused by a rise in the national sales tax and ran counter to economists forecasts for a 2.1 percent rebound.

The data initially pushed the yen to a seven-year low against the dollar, but as Tokyo stocks fell the Japanese currency rebounded.

It also shaved $1 off the price of Brent crude oil and sent ripples across Europe, where the FTSEurofirst 300 pan-European share index was down 0.3 percent.

Data on Friday showed euro zone economic output expanded more than expected in the third quarter but remained weak.

Leaders from the G20 group of countries agreed on Sunday a package of measures they said would add an extra 2.1 percentage points to growth over five years. They also agreed steps to tackle climate change and crack down on tax avoidance.

But financial markets focused on Japan's economic downturn.

"It's a bit of shock for the market, because people believed that the Bank of Japan had everything under control. But overall, the initial negative reaction shouldn't last too long. Investors still expect central bank action worldwide to support the global economy," FXCM analyst Nicolas Cheron said.

Other Asian shares also fell. MSCI's main index of Asia-Pacific stocks outside Japan lost 0.5 percent.

Chinese equities dropped as profit taking outweighed buying by foreign investors as a landmark Hong Kong-Shanghai trading link debuted on Monday.

The Shanghai Composite ended down 0.2 percent and Hong Kong's Hang Seng lost 1 percent.

The yen was the big mover on foreign exchange markets. After the GDP data, it fell to as low as 117.06 to the dollar but later rebounded and was last at 116.12, up 0.3 percent on the day.

The dollar index dipped 0.1 percent as a result and the euro made a similar gain versus the greenback.

As the Japanese data stoked concerns about the global economy, undermining stronger-than-expected U.S. retail sales data on Friday, German 10-year Bund yields also fell, opening down 2 basis points at 0.77 percent, just above a record low of 0.716 percent.

Brent crude last traded at $78.32 a barrel, down 1.4 percent after the Japanese data was seen hitting global demand.

"This is another knock on crude oil prices, another bearish factor," said Tony Nunan, oil risk manager at Mitsubishi Corp.

Eyes remain on possible OPEC production cuts when the oil cartel meets next week.

Gold held near two-week highs on a softer dollar. Spot gold was last at $1,185.60.

source: interaksyon.com