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  • Last Update : 09:54 am

US stock futures extend losses as Trump tests positive for Covid-19

  • Published at 04:18 am October 2nd, 2020
New York Stock Exchange (NYSE)
File photo: A worker cleans the floor of the New York Stock Exchange (NYSE), US, March 20, 2020 Reuters

Trump's positive could cause a new wave of market volatility

US stock futures extended losses on Friday after President Donald Trump said he and his wife had tested positive for the coronavirus, weeks ahead of elections.

Futures for the S&P 500 slid 1.21% by early afternoon in Asia, while Treasury yields also fell.

The US dollar rose, particularly against the British pound, the Australian and New Zealand dollars in a sign of risk aversion.

Trump earlier said on Twitter that he and his wife had been tested for coronavirus after Hope Hicks, a senior adviser who recently travelled with the president, tested positive.

He later tweeted he and the first lady had tested positive: "We will begin our quarantine and recovery process immediately," he said.

Trump's positive could cause a new wave of market volatility as investors brace for the hotly-contested presidential election in November.

"It has the potential to reduce Trump's campaigning ability. He's got a lot on and it's an interruption," said Sean Callow, currency strategist at Westpac in Sydney.

"It also hurts him as far as the whole narrative that it's really not much to worry about - it puts the Covid crisis itself back front and centre."

MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.27%. Australia's S&P/ASX 200 index fell 0.98% as a decline in oil and copper prices weighed on the country's resources sector.

Japan's Nikkei 225 index erased gains and fell 0.69% as the Tokyo Stock Exchange resumed normal trading after its worst-ever outage brought the world's third-largest equity market to a standstill.

Euro Stoxx 50 futures were up 0.06%, German DAX futures rose 0.03%, but FTSE futures were down by 1.02%.

Markets had been choppy early after a spate of data, including jobless claims and consumer spending, suggested that the plodding US economic recovery could be losing steam.


Also Read - Trump, Melania test positive for Covid-19


Futures for the tech-heavy Nasdaq fell 1.7%. The benchmark 10-year Treasury yield fell to 0.6545%.

China's stock and bond markets, foreign exchange and commodity futures markets are closed October 1-8 for the Golden Week holiday. South Korea and Hong Kong markets are also closed on Friday for holidays.

US markets kicked off the fourth quarter by closing higher on Thursday while investors tracked progress in negotiations for additional fiscal stimulus.

The Dow Jones Industrial Average rose 0.13% on Thursday. The S&P 500 gained 0.53% and the Nasdaq Composite added 1.42%.

US consumer spending is starting to slow due to a shaky jobs market. If policymakers cannot agree on more support, the US economy could lose more momentum.

Traders are also waiting for the Labor Department's report on non-farm payrolls and the jobless rate later Friday, following new layoff announcements from the likes of Disney and Goldman Sachs.

The dollar index jumped 0.3% on risk aversion.

Spot gold fell 0.55% to $1,894.60 an ounce, adding to its worst month since November 2016, while oil prices continued to fall, adding to a 10% September drop.

Brent crude futures were trading down 0.93% at $40.54 a barrel on Friday, while US crude futures were down 0.98% at $38.34 a barrel.

Oil prices fell more than 3% on Thursday as rising coronavirus cases around the world dampened the demand outlook, while a rise last month in member output from the Organization of the Petroleum Exporting Countries also pressured prices.

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