GLOBAL MARKETS-Global stocks edge lower on economic toll from virus; oil rallies

By David Randall
NEW YORK, April 3 (Reuters) - Global stock markets sank
Friday following more signs that the COVID-19 pandemic would
take a massive toll on economic growth, while oil prices
continued to rally on hopes of a cut to global supply.
Investors sought out safe havens in the U.S. dollar and
government bonds, pushing U.S. Treasury yields near their lowest
in three weeks.
U.S. payrolls fell by the largest amount since March 2009,
ending a record 113 straight months of job growth. Morgan
Stanley said the U.S. economy will shrink 5.5% in 2020, the
steepest drop since 1946, with a huge 38% contraction predicted
for the second quarter.
In Europe, a number of firms flagged a hit to business from
the pandemic caused by the new coronavirus, foreshadowing a
deeper earnings recession ahead of the reporting season. .EU
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.64% following broad declines in Europe and Asia.
In early trading on Wall Street, the Dow Jones Industrial
Average .DJI fell 99.09 points, or 0.46%, to 21,314.35, the
S&P 500 .SPX lost 8.17 points, or 0.32%, to 2,518.73 and the
Nasdaq Composite .IXIC dropped 21.67 points, or 0.29%, to
7,465.64.
"Global recession fears are now being confirmed by the
incoming economic prints," said Han Tan, market analyst at FXTM.
"Until the virus case count peaks and the business earnings
outlook improves, risk sentiment may only experience fleeting
bouts of positivity."
The pandemic has claimed more than 52,000 deaths as it
further exploded in the United States and the death toll climbed
in Spain and Italy, according to a Reuters tally. Concerns about the extent of the damage to the global
economy pushed investors into the perceived safety of government
bonds. Benchmark 10-year notes US10YT=RR last rose 11/32 in
price to yield 0.5932%, from 0.627% late on Thursday.
"You have to take into consideration this isn't the full
impact just yet," said Peter Cardillo, chief market economist at
Spartan Capital Securities in New York, adding that he expects
"further erosion in the job market in the months ahead.”
Brent crude futures LCOc1 gained 8.95% to $32.62,
extending Thursday's record 24.7% surge , while U.S. West Texas
Intermediate (WTI) crude CLc1 rose 4.66% to $26.42. O/R
U.S. President Donald Trump on Thursday said he had brokered
a deal that could result in Russia and Saudi Arabia cutting oil
output by an unprecedented 10 million to 15 million barrels per
day (bpd), representing 10-15% of global supply. Trump said he
had not offered to cut U.S. output. Saudi Arabia said it would call an emergency meeting of the
Organization of the Petroleum Exporting Countries (OPEC), state
media reported.
In early March, talks over production cuts between Russia
and Saudi Arabia collapsed, leading them to start a price war
that has pushed oil prices to their lowest levels in nearly two
decades.

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