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News of Donald Trump’s diagnosis caused new political chaos in the world’s largest economy just a month before Americans went to the polls.
United States President Donald Trump greets the first day of the Republican National Convention at the Charlotte Convention Center on August 24, 2020 in Charlotte, North Carolina. Image: AFP
LONDON – Global stocks tumbled on Friday after US President Donald Trump revealed that he and his wife tested positive for COVID-19, sparking new political chaos in the world’s largest economy just a month earlier. Americans going to the polls.
The deepening turmoil sent US futures plunging as investors nervously waited for Wall Street to reopen at 1330 GMT, with key nonfarm payroll data scheduled for release.
Europe’s major stock markets fell sharply before regaining ground.
Japan’s Nikkei closed 0.7% lower as trading resumed after Thursday’s market close caused by a technical failure, and amid holiday closures in many key hubs in Asia.
Oil prices tumbled four percent, extending Thursday’s heady losses that also stemmed from the flooded crude oil market amid timid demand.
‘POLITICAL UNCERTAINTY’
“Increasing political uncertainty related to Trump’s diagnosis is … weighing on stocks and equity futures, and supporting safe havens like the yen, the Swiss franc and the US dollar,” he told AFP Jane Foley, an analyst at Rabobank.
“The extent to which the election campaign is affected will depend on the outcome for Trump’s health.”
He added: “There are enough unknowns at the moment to fuel speculation that the election could be quite different than what was expected just 24 hours ago.”
The 74-year-old Trump’s extraordinary setback has immediate political consequences just 31 days before Election Day, forcing him to cancel campaign trips and adding new volatility to an already fraught contest.
The White House doctor has said both were fine and that Trump would continue his “presidential duties without interruption.”
The president had undergone a test after his close White House aide, Hope Hicks, had tested positive earlier that day, meaning that he will now have to go into quarantine just weeks before one of the most crucial elections. the country has had.
Investors were already pessimistic about the failure of US lawmakers to pass a new stimulus bill, traders said.
ALL EYES ON TRUMP HEALTH
“We are seeing some risk aversion in the wake of the Trump news, although so far the moves that we are seeing are quite modest,” Oanda analyst Craig Erlam told AFP.
“If Trump’s health deteriorates, I hope we will see more significant moves, but there are no signs of that at this time.”
Sentiment had already been weak as hopes for a new US bailout package faded.
“It is also worth noting that this week’s stimulus talks have not gone well, which may be contributing to the risk aversion we are seeing in the markets, while the (US) employment report of today it can make people a bit cautious, “Erlam added. .
Democrats pushed their latest $ 2.2 trillion proposal through the House, where they have a majority, but without any opposition support, there is no chance it will be agreed to by the Republican-dominated Senate.
Key figures around 1000 GMT
London – FTSE 100: DOWN 0.9% to 5,829.03 points
Frankfurt – DAX 30: DOWN 0.9% to 12,610.70
Paris – CAC 40: LOWER 0.7% to 4,792.31
EURO STOXX 50: DOWN 0.8% to 3,168.17
Tokyo – Nikkei 225: DOWN 0.7% to 23,029.90 (close)
Hong Kong – Hang Seng: closed for holidays
Shanghai – Composite: Closed for holidays
New York – Dow Jones: + 0.1% to 27,816.90 (close)
Euro / Dollar: DOWN to $ 1.1722 from $ 1.1748 at 2100 GMT
Dollar / yen: DOWN to 105.20 yen from 105.53 yen
Pound / Dollar: UP to $ 1.2929 from $ 1.2891
Euro / Pound: DOWN to 90.59 pence from 91.14 pence
West Texas Intermediate: DOWN 4.2% at $ 37.09 per barrel
North Sea Brent Crude: DOWN 4.1% to $ 39.24
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