Reuters | Sep 21, 2020 04:48
By Elizabeth Howcroft
LONDON (Reuters) - European shares fell on Monday as rising COVID-19 infection rates in Europe prompted renewed lockdown measures in some countries, casting doubt over the economic recovery, with a lack of U.S. stimulus also weighing on sentiment.
The MSCI world equity index (MIWD00000PUS), which tracks shares in 49 countries, was down 0.5% at 0748 GMT.
European indexes opened lower, with the pan-European STOXX 600 down 1.7% (STOXX), at its lowest in nearly two weeks. London's FTSE 100 was at a two-week low, down 2.4% (FTSE) and Germany's DAX fell 2% (GDAXI).
Banking shares slid after a media report on how several global banks moved large sums of allegedly illicit funds over nearly two decades.
HSBC [HSBCUK.UL] shares sunk to a 25-year low in Hong Kong.
Investors are becoming more cautious about Europe, amid a sharp uptick in new COVID-19 cases. European countries including Denmark, Greece and Spain have introduced new restrictions on activity.
Britain is considering a second national lockdown as new cases rise by at least 6,000 per day.
Germany's health minister said the rising new infections in countries like France, Austria and the Netherlands is worrying.
Investors will be looking ahead to flash PMI data on Wednesday for the first hints of how economies have fared in September.
"Concerns are rising that the summer recovery is probably as good as it gets when it comes to the recent rebound in economic activity," wrote Michael Hewson, chief market analyst at CMC Markets UK.
"This reality combined with the growing realisation that a vaccine remains many months away, despite President (Donald) Trump's claims to the contrary, has made investors increasingly nervous, as we head into an autumn that could see lockdowns reimposed," he said.
The dollar declined for the second week running last week, hurt by the U.S. Federal Reserve's commitment to keeping rates lower for longer.
It was trading less than 0.1% up against a basket of currencies at 92.997 at 0750 GMT (=USD).
Seven members of the Fed will speak this week - including chairman Jerome Powell appearing before Congressional committees - so investors will be looking for hints to determine the dollar's direction.
The safe-haven yen was in its sixth consecutive session of gains versus the dollar, up around 0.4% at 104.185
Japan has public holidays on Monday and Tuesday this week, meaning volumes are thin in Asian trading.
The benchmark 10-year German government bond yield was down 2 basis points at -0.507% (DE10YT=RR), with most high-rated euro zone government bond yields down by a similar amount.
The European Central Bank will review how long its emergency pandemic bond-purchase scheme should go on, the Financial Times reported.
The European Council meets in a summit on Thursday and Friday this week.
Gold prices edge higher, helped by the weaker dollar, with spot gold
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.
More content, faster quotes and charts, and a smoother experience is available only on the App.