Global Stocks Retreat After Back-to-Back Gains in Dow

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03/26/2020 | 09:33 am

By Chong Koh Ping

Stock markets around the world slipped as investors weighed new developments related to the coronavirus pandemic, including the progress of a huge U.S. stimulus package.

U.S. stock futures fell, with securities tied to the S&P 500 trading 1.4% lower Thursday. In Europe, the pan-continental Stoxx Europe 600 declined 1.7%.

The yield on the benchmark 10-year U.S. Treasury retreated to 0.802% from 0.854% Wednesday. Bond yields fall as prices rise.

Most major stock markets in Asia-Pacific closed down.

Japan's Nikkei 225 lost 4.5%, giving back some of the previous session's gains. Benchmarks in Hong Kong and Shanghai retreated less than 1%.

Singapore's FTSE Straits Times Index shed 1% after the country forecast that the economy could contract by up to 4% in 2020 in its first full-year recession since 2001.

Volatile stock markets reflect investors grappling with a lot of conflicting information, said Vikas Pershad, portfolio manager at M&G Investments. "The markets are not broken. What we're seeing is a very large disconnect between the present world and the future that they're pricing in," he said.

The U.S. Senate approved an estimated $2 trillion stimulus package late on Wednesday in Washington. The bill will now move to the House as Congress seeks to give American families and businesses a financial shield against the ravages of the pandemic.

Mr. Pershad said the U.S. government's plan to directly support consumers was positive for both investor sentiment and corporate fundamentals in Asia. "A lot of supply chains in Asia are tied to the U.S. consumers," he said, citing smartphones and semiconductors.

The number of new coronavirus cases in the U.S. topped 66,100, with a death toll of more than 940, led by a continued surge of infections in New York. Globally, there were more than 470,000 cases Thursday, with a death toll surpassing 21,200, according to data from Johns Hopkins University.

On Wednesday, U.S. stocks scored their first consecutive two-day gains since February on the back of the stimulus deal. The Dow Jones Industrial Average rose 2.4% while the S&P 500 added 1.2%.

The dollar edged down, with the WSJ Dollar Index declining 0.4% to 95.13. The index tracks the greenback against 16 other currencies.

Later in the day, investors are awaiting the release of the U.S. Labor Department's weekly jobs-claims report. It will show the scale of layoffs related to the coronavirus amid widespread business closures. Economists forecast that new applications for unemployment benefits will jump to the highest level on record for the week ending on March 21.

Write to Chong Koh Ping at


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