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Asia Stocks Set to Tumble After Wall Street Rout: Markets Wrap

Published 03/13/2020, 05:43 AM
Updated 03/13/2020, 06:12 AM
Asia Stocks Set to Tumble After Wall Street Rout: Markets Wrap
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(Bloomberg) -- Stocks were primed for heavy losses in Asia after the worst Wall Street session since 1987, with investors fretting that emergency fiscal and monetary packages won’t be enough to stave off a recession.

The S&P 500 lost 9.5% and futures on Japan’s Nikkei 225 were down 8%. The global equities rout took Brazil’s benchmark down 15% on Thursday and Canada’s main gauge posted its worst day since 1940. Oil and precious metals fell, with palladium entering a bear market. The dollar surged.

“Markets remain in a free fall as uncertainty persists with no reliable anchor which can create near-term stability,” said Ben Emons, managing director of global macro strategy at Medley Global Advisors in New York.

Benchmark Treasury yields pared some declines after the Federal Reserve pledged $1.5 trillion in liquidity. Investors are trying to gauge how effective policy responses can be as coronavirus cases continue to grow across the world and restrictions on people and businesses crush sentiment. The European Central Bank eased capital constraints and boosted liquidity, and losses only deepened.

These are some of the most notable moves:

  • The S&P 500, Nasdaq Composite and Nasdaq 100 indexes are all in a bear market now, with losses from February closing records extending well past 20%.
  • The slump triggered the second 15-minute trading halt this week shortly after the U.S. open.
  • The MSCI All-Country World Index extended losses to enter bear-market territory.
  • The cost of insuring debt issued by Europe’s investment grade companies surged to the highest since 2016.
  • Oil extended losses past 5%. Bitcoin took a dive. Gold fell below $1,600 an ounce.
Meantime, New York City has now declared a state of emergency, France and Portugal said they will close all schools and a leading U.S. infectious disease official said the testing system in that country is failing. Walt Disney (NYSE:DIS) Co. is shutting its Disneyland resort in California from Saturday, following previous closures in Asia.

These are the main moves in markets:

Stocks

  • The S&P 500 Index declined 9.5%.
  • Futures on Japan’s Nikkei 225 fell 7%.
  • Hang Seng futures earlier dropped 0.5%.
  • Futures on Australia’s S&P/ASX 200 Index lost 7.2%.
Currencies

  • The Bloomberg Dollar Spot Index gained 1.1%.
  • The euro was at $1.1187.
  • The yen fell 0.1% to 104.76 per dollar.
  • The offshore yuan was at 7.0279 per dollar.
Bonds

  • The yield on 10-year Treasuries fell six basis points to 0.81%.
Commodities

  • West Texas Intermediate crude declined 6% to $30.99 a barrel.
  • Gold added 0.3% to $1,580.35 an ounce.

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