S&P 500 dipped last night, with Asian Stocks Slipping amid virus fears | S&P 500 futures and European contracts ticking lower

22/12/2020 Asian stocks dipped this morning after U.S. equities joined a global decline last night as a new variant of the coronavirus in the U.K. and a wave of lockdowns and travel restrictions hurt sentiment. Japan and Australia underperformed as shares slipped across major Asia-Pacific markets. S&P 500 futures edged down, with European contracts also lower. The dollar ticked higher, and the yield on 10-year Treasuries was steady. Crude oil held below $48 a barrel. Tencent trading 0.61% lower in HK. The JSE Top 40 futures are indicating a lower start, down 263 points or 0.49%, with the Rand on the backfoot again after an earlier recovery, -0.62% to 14.68vs the USD.

Locally the FTSE/JSE Africa All-Share Index closed down 1.8% to 58,714, with financials and property sectors weighing the most, down 4.8% and 4.2% respectively. Banks got knocked heavily on the back of a weaker Rand on a risk off day, with Naspers and Prosus together with some gold shares the few that ended the day positive. The Rand was down 0.8% to 14.6614 per US$, with the Yield on 10 year govt rand bonds that rose 13.6 bps to 8.837%.
South African judicial panel probing graft during former President Jacob Zuma’s rule will ask the High Court to extend its mandate until the end of June, Deputy Chief Justice Raymond Zondo told reporters in an online briefing.

  • (LHC SJ): Virus Surge Puts South African Hospitals Under ‘Severe Strain’
  • South Africa’s ANC Cancels Anniversary Celebrations Due to Virus
  • JPMorgan Ousted as Mideast-Africa’s Top Dealmaker by U.S. Rivals
  • (MTN SJ): MTN Rwandacell to List Shares on Rwandan Bourse Early 2021
  • (WHL SJ): Woolworths Sells Property in Sydney, Australia for A$510m
  • (SOL SJ): Sasol Agrees on Mozambique Gas Plant Sale in Latest Disposal

ECONOMIC DATA

  • 2pm: (SA) Nov. Monthly Budget Balance, prior -49.7b

EU/UK
European markets closed significantly lower yesterday as investors monitored a fast-spreading new variant of the coronavirus that has shut down much of the U.K. The pan-European Stoxx 600 closed down 2.3%, with banks falling 3.6% to lead losses. All sectors and major bourses slid into negative territory. London’s FTSE index gave up 1.73%, with Germany’s DAX shedding 2.8%, while France’s CAC closed the session down 2.4%. Traders are nervously watching the new Covid mutation in the U.K., which has resulted in a tough lockdown in London and other parts of southeast England and a U-turn on the mixing of households over the Christmas break. The variant is thought to be up to 70% more transmissible than the original strain of the disease. It has led to several countries in Europe and elsewhere to block travel from Britain. France, Germany, Italy, Ireland and the Netherlands all barred flights from the U.K., as have Canada and Israel.
US
The S&P 500 fell slightly in volatile trading last night to start the holiday week as enthusiasm over a coronavirus stimulus deal was overwhelmed by worries over a viral new Covid strain in the U.K. The broad equity index dipped 0.4%, or 14.49 points, to 3,694 after falling nearly 2% at its session low. The Nasdaq Composite fell 0.1%, or 13.12 points, to 12,742. The Dow Jones Industrial Average erased a 400-point loss to eke out a small gain as strength in Nike and bank shares supported the blue-chip benchmark. The 30-stock Dow rose 0.1%, or 37.40 points, to 30,216. Nike popped nearly 5% to hit a record high on the back of strong earnings. Bank stocks jumped in unison with JPMorgan and Goldman up 3.8% and 6.1%, respectively, after the Federal Reserve announced it will allow the industry to resume share buybacks in the first quarter of 2021. Travel-related stocks initially fell sharply on news of an infectious new coronavirus strain in the U.K., which triggered more severe lockdowns and travel restrictions across Europe.
ASIA
Asia-Pacific markets trading mostly lower this morning following overnight declines on Wall Street as investors kept an eye on Brexit trade talks as well as ongoing negotiations in the U.S. for a coronavirus relief package. The Nikkei 225 in Japan fell 1.04% to 26,436 while the Topix index dropped 0.18%, with South Korea’s Kospi index down 0.33% to 2,746. In Australia, the benchmark ASX 200 declined 1.05% to 6,599, with all sectors finishing in the red. The energy subindex dropped 0.37% as oil stocks struggled for gains. Hong Kong’s Hang Seng index declined 1.07% in late-afternoon trade. Chinese mainland markets also struggled as the Shanghai traded down 1.3% . Major indexes in India and Singapore also traded down in the afternoon.
COMMODITIES
Oil fell toward $47 a barrel after dropping the most since early November on Monday as a faster-spreading strain of the virus discovered in the U.K. raised the risk of more lockdowns and less global travel. Futures in New York for February delivery dropped 1.9% after losing 2.6% in the previous session.
Gold advanced 0.3% to $1,883.20 at 10:35 a.m. in Singapore, with prices up about 24% this year. Silver rose 1%, while palladium and platinum also gained.