U.S. stock-index futures, global stocks and oil prices fell early Monday, rattled by the coronavirus pandemic and delay in Washington over an economic rescue package.
The number of confirmed novel coronavirus cases world-wide more than doubled in a week to nearly 330,000 Sunday, with deaths surpassing 14,000. U.S. infections topped 32,000, jumping 10-fold from a week earlier.
Tougher restrictions world-wide to combat the coronavirus have led to lockdowns in cities and stoked fears about the impact on economic activity.
U.S. lawmakers and administration officials had hoped to reach an agreement on a $1.3 trillion deal so both chambers of Congress could approve it Monday. But the package hit a procedural roadblock in the Senate Sunday, a sign of political discord amid a national emergency.
S&P 500 futures fell nearly 4%, after briefly falling further to hit the maximum 5% loss allowed in a single session. That suggested U.S. shares would face further pressure Monday. Last week, the Dow Jones Industrial Average and S&P 500 indexes registered their worst weeks since October 2008.
“The futures market is really getting hit on the fact that the stimulus and fiscal relief package was falling foul of the political impasse in the Senate,” said Andy Maynard, managing director of equities sales and trading at China Renaissance Securities.
Mr. Maynard said this added to concerns stoked by rising infection figures, statewide restrictions on activity, and expectations for rising U.S. unemployment.
The yield on the 10-year U.S. Treasury note fell 0.148 percentage point to 0.788%, according to Tradeweb, as investors sought the safety of government bonds. Yields move in the opposite direction to prices.
European markets opened lower. The Stoxx Europe 600 pan-continental index fell 3.2%, and the German Dax dropped nearly 5%. German Chancellor Angela Merkel is self-isolating after coming into contact with an infected doctor. The government is set to adopt fiscal measures worth €500 billion ($535 billion) to help cushion Europe’s economic powerhouse from the impact of the pandemic.
Adrian Zuercher, head of asset allocation for the Asia-Pacific region at UBS Global Wealth Management, said the Senate delay, the lockdown of New York and rising U.S. jobless claims had all pressured the market.
“The key uncertainty is how long Europe and the U.S. will be locked down,” Mr. Zuercher said. “Lower interest rates and stimulus packages are not helping you if people can’t go out and spend or even if they can but they don’t want to because they’re scared.”
In the Asia-Pacific region, most stock benchmarks dropped. Australia’s benchmark S&P/ASX 200 fell nearly 8% to levels last reached in 2012, despite the country’s federal government rolling out a stimulus package of 66 billion Australian dollars ($38 billion). Indian shares plunged, triggering trading halts, with the S&P BSE Sensex index falling more than 11%.
Japan’s Nikkei 225 bucked the downtrend, ending 2% higher. It had been closed Friday, when some other Asian markets had rallied. Shares in SoftBank Group, a major index constituent, soared on plans to sell up to ¥4.5 trillion ($41 billion) of assets to buy back shares and redeem debt.
The Japanese yen regained some ground, strengthening 0.9% to ¥109.89 a dollar. Elsewhere, a rush to secure dollars continued. The South Korean won traded close to a multiyear intraday trough reached last week, while the Indonesian rupiah dropped 3.5% to around its weakest on record. The WSJ Dollar Index, which tracks the greenback against a basket of 16 currencies, declined 0.2% to 96.61, still not far off a multiyear high hit last week.
Brent crude oil fell 4.6% to $25.82 a barrel. That put Brent, the global oil benchmark, close to the $24.88 level it hit on Wednesday, which was the lowest since May 2003. Crude prices have plunged on worries about reduced demand and a price war among major oil producers.
Gas prices have been falling along with crude-oil and stocks in recent weeks.
Photo: Will Lester/Orange County Register/Zuma PressWrite to Joanne Chiu at joanne.chiu@wsj.com
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Stocks, Oil Fall as Rescue Package Stalls in Senate - The Wall Street Journal
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