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Stocks Extend Losses, Bond Yields Hit Record Lows: Markets Wrap

Bloomberg logoBloomberg 2/27/2020 Sam Potter
Traders work on the floor of the New York Stock Exchange during the afternoon of October 1, 2014 in New York City. The Dow Jones Industrial Average dropped over 230 points at the time of the   closing bell. © Andrew Burton/Getty Images Traders work on the floor of the New York Stock Exchange during the afternoon of October 1, 2014 in New York City. The Dow Jones Industrial Average dropped over 230 points at the time of the closing bell.

(Bloomberg) -- The worldwide stock sell-off extended on Thursday, putting a global benchmark on course for the lowest close since October as investors continue to fret the spread of the coronavirus. Most government bonds added to gains, sending yields to unprecedented lows.

The MSCI All-Country World Index fell for a sixth straight day, with Japan’s benchmark gauge leading declines among major indexes. Futures on the S&P 500 dropped as much as 1.6% but recovered around half of those losses. Having closed flat on Wednesday the Stoxx Europe 600 slumped in a broad-based retreat, with Anheuser-Busch InBev NV among the worst performers after a dismal forecast. Several large companies on the benchmark, including HSBC Holdings Plc, are today trading without the right to dividends, potentially exacerbating declines.

Safer assets continued to be in demand, and the yen strengthened as yields on 10-year U.S. and Australian government bonds hit fresh record lows. Oil sank further. The pound reversed a gain after the U.K. told the European Union it could walk away from the negotiating table in June if progress isn’t being made toward a trade deal.

a screenshot of a cell phone: World copper stockpiles surged to 2018 high amid virus woe © Bloomberg World copper stockpiles surged to 2018 high amid virus woe

While the pace of selling across markets appears to have eased a little -- shares even edged up in both Hong Kong and Shanghai on Thursday -- the losses continue to mount as investors weigh each gloomy headline on the virus. U.S. health authorities on Wednesday said they found the first case of the illness that does not have ties to a known outbreak. Microsoft Corp. joined an expanding list of companies warning over the impact of the virus on operations.

Global shares are down more than 7% from the peak reached earlier this month.

“Even with that retracement and multiple derating, we’re still at cycle highs,” George Boubouras, head of research at K2 Asset Management in Melbourne, told Bloomberg TV. “But once we get through this very large uncertainty, markets will have an enormous coordinated tailwind of fiscal and monetary stimulus to help those equity valuations in 2021.”

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Here are some key events still to come this week:

Earnings keep rolling in from companies including: Baidu Inc., Best Buy Co., Occidental Petroleum Corp. and Dell Technologies Inc. on Thursday, and London Stock Exchange Group Plc on Friday.U.S. jobless claims and durable goods data are out Thursday.Japan industrial production, jobs, and retail sales figures are due on Friday.

These are the major moves in markets:

Stocks

Futures on the S&P 500 Index dipped 0.6% as of 10:21 a.m. London time.The Stoxx Europe 600 Index decreased 2.1%.The U.K.’s FTSE 100 Index fell 1.7%.The MSCI Asia Pacific Index declined 0.7%.

Currencies

The Bloomberg Dollar Spot Index dipped 0.1%.The euro jumped 0.5% to $1.0939.The British pound decreased 0.3% to $1.2871.The Japanese yen strengthened 0.3% to 110.15 per dollar.The offshore yuan strengthened 0.1% to 7.0115 per dollar.

Bonds

The yield on 10-year Treasuries fell four basis points to 1.30%.Germany’s 10-year yield dipped one basis point to -0.52%.Britain’s 10-year yield declined four basis points to 0.469%.

Commodities

Gold strengthened 0.4% to $1,646.80 an ounce.West Texas Intermediate crude declined 1.9% to $47.78 a barrel.

--With assistance from Cormac Mullen, Gregor Stuart Hunter, Winnie Zhu and Adam Haigh.

To contact the reporter on this story: Sam Potter in London at spotter33@bloomberg.net

To contact the editors responsible for this story: Sam Potter at spotter33@bloomberg.net, Yakob Peterseil

For more articles like this, please visit us at bloomberg.com

©2020 Bloomberg L.P.

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