Shares, oil prices sink after Trump tests positive for coronavirus


U.S. stock futures and many overseas stock indices fell Friday after President Donald Trump said he and his wife, Melania Trump, had tested positive for the new coronavirus.

The future contracts for both the S&P 500 and the Dow industrials dropped nearly two per cent but were trading 1.2 per cent lower several hours later. Oil prices tumbled about 3.3 per cent.

Trump tweeted news of his test results just hours after the White House announced that senior aide Hope Hicks had come down with the virus after travelling with the president several times this week.

The positive test reading for the leader of the world’s largest economy heaps uncertainty onto a growing pile of unknowns investors are grappling with, first among them how it might affect the Nov. 3 election and American policies on trade, tariffs and many other issues beyond then.

“To say this potentially could be a big deal is an understatement,” Dutch financial services company Rabobank said in a commentary. “Anyway, everything now takes a back seat to the latest incredible twist in this U.S. election campaign.”

U.S. President Donald Trump and his wife, Melania Trump, arrive at Cleveland Hopkins International Airport on Sept. 29, 2020, ahead of the presidential election debate. The Trumps have tested positive for the coronavirus and are in quarantine. (Carlos Barria/Reuters)

A statement issued by Trump’s doctor saying both he and his wife were well and that he would continue his duties appeared to calm the markets’ reaction.

European markets slide

Germany’s DAX and the CAC 40 in Paris lost about one per cent. Britain’s FTSE 100 slipped 0.8 per cent.

Trading in Asia was thin, with markets in Shanghai and Hong Kong closed. The Nikkei 225 index shed strong early gains, losing 0.7 per cent to 23,029.90 after the Tokyo Stock Exchange resumed trading following an all-day outage as a result of a technical failure.

Reports that the Japanese government is preparing new stimulus measures to help the economy recover from a prolonged downturn worsened by the coronavirus pandemic provided only a temporary lift. Prices fell further after Trump’s announcement.

On Thursday, the benchmark S&P 500 ended the day 0.5 per cent higher, at 3,380.80, the Dow Jones Industrial Average rose 0.1 per cent to 27,816.90 and the Nasdaq composite rose 1.4 per cent to 11,326.51, as big tech-oriented stocks propped up the market, much as they have through the pandemic. The S&P/TSX composite index rose 0.4 per cent on Thursday to 16,184.54.

Big swings

Such big swings have become routine as investors assess chances of a deal on Capitol Hill to send more cash to Americans, restore jobless benefits for laid-off workers and deliver assistance to airlines and other industries hit particularly hard by the pandemic.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin continued their talks on Thursday, but no breakthrough arrived before stock trading ended on Wall Street. Instead, there were only hopes that were periodically raised and dashed as government officials took turns criticizing each other.

Beyond potential political developments, investors will be watching for job figures due out Friday. Data released Thursday painted a mixed picture for the economy, with one report showing the number of workers filing for unemployment benefits last week fell to 837,000 from 873,000. That was less than economists expected, but incredibly high compared with before the pandemic.

With airlines and other major companies announcing layoffs and furloughs, another round of economic aid from Congress is seen as crucial. Mnuchin and Pelosi have worked effectively together in the past, helping to drive through the previous economic rescue approved by Congress in March. But the country’s deepening partisan divide has stymied progress, with the presidential election only about a month away.





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Johny Watshon

Life is like a running cycle right! I am a news editor at TIMES. Collecting <a href="https://usanewsupdate.com/" target="_blank" rel="noopener noreferrer">News</a> is my passion. Because my visitors have the right to know the truth and perfectly.

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