Wall Street falls, Treasury yields drop along with investor risk appetite

By Stephen Culp NEW YORK (Reuters) - Wall Street sank and U.S. Treasury yields edged lower on Thursday as euphoria over a potential COVID-19 vaccine faded in the face of spiking infections and threat of a new round of economic restrictions to contain the pandemic.

Reuters November 13, 2020 02:05:47 IST
Wall Street falls, Treasury yields drop along with investor risk appetite

Wall Street falls Treasury yields drop along with investor risk appetite

By Stephen Culp

NEW YORK (Reuters) - Wall Street sank and U.S. Treasury yields edged lower on Thursday as euphoria over a potential COVID-19 vaccine faded in the face of spiking infections and threat of a new round of economic restrictions to contain the pandemic.

The sell-off was broad, with economically-sensitive cyclical stocks, which rallied on Monday and Tuesday, suffering the deepest losses.

On Monday, Pfizer Inc announced the COVID-19 vaccine candidate it developed with German partner BioNTech SE appears to be 90% effective at preventing infection, news that sent equity markets surging worldwide.

But new coronavirus infections in the United States and elsewhere are reaching record levels and tightening economic restrictions to contain the spread has dampened the prospect of a quick end to the global health crisis.

"Earlier this week, it was 'a vaccine is here,' but today the trading seems to be 'the vaccine might not be here for a while,'" said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "And the acceleration of new cases seems to be raising the idea that more stringent lockdowns are going to be necessary."

The Dow Jones Industrial Average <.DJI> fell 392.7 points, or 1.34%, to 29,004.93, the S&P 500 <.SPX> lost 43.66 points, or 1.22%, to 3,529 and the Nasdaq Composite <.IXIC> dropped 84.09 points, or 0.71%, to 11,702.34.

A surge in new coronavirus infections prompted a retreat of European shares away from eight-month highs, with banks leading the decline, as hopes waned for a quick economic rebound.

The pan-European STOXX 600 index <.STOXX> lost 0.88% and MSCI's gauge of stocks across the globe <.MIWD00000PUS> shed 0.78%.

Emerging market stocks rose 0.18%. MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> closed 0.12% higher, while Japan's Nikkei <.N225> rose 0.68%.

U.S. Treasury yields, which can be viewed as a gauge of risk appetite, slumped amid the risk-off mood and hit session lows following a tweet from Bloomberg that the Trump administration was backing away from stimulus talks.

Benchmark 10-year notes last rose 30/32 in price to yield 0.8897%, from 0.989% late on Tuesday.

The 30-year bond last rose 73/32 in price to yield 1.6572%, from 1.76% late on Tuesday.

Crude oil prices reversed early gains, snapping a three-day rally on growing doubts over a near-term demand recovery.

U.S. crude fell 0.80% to settle at $41.12 per barrel, while Brent settled at $43.53 per barrel, down 0.62% on the day.

The dollar was slightly down against a basket of currencies, reflecting oscillating sentiment between vaccine hopes and coronavirus worries.

The dollar index <.DXY> fell 0.07%, with the euro up 0.23% to $1.1804.

The Japanese yen strengthened 0.27% versus the greenback at 105.15 per dollar, while Sterling was last trading at $1.311, down 0.84% on the day.

Risk-off sentiment attracted investors back to gold, which continued to recover some ground that the safe-haven metal lost in Monday's plunge.

Spot gold added 0.6% to $1,876.61 an ounce.

(Reporting by Stephen Culp; additional reporting by Marc Jones; Editing by Tom Brown)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

U.S. job openings rise slightly in September
Business

U.S. job openings rise slightly in September

WASHINGTON (Reuters) - U.S. job openings increased moderately in September and layoffs appeared to abate, pointing to a gradual labor market recovery from the COVID-19 pandemic.

Central bankers seek new role in brave new world
Business

Central bankers seek new role in brave new world

By Balazs Koranyi and Francesco Canepa FRANKFURT (Reuters) - Taking a break from fighting the coronavirus crisis, the world's top central bankers will attempt to resolve the existential questions of their profession this week as they tune into the European Central Bank's annual policy symposium. Having struggled to lift anaemic inflation for years, officials including the heads of the ECB, the U.S. Federal Reserve and the Bank of England will attempt to figure out why monetary policy is not working as it used to and what new role they must play in a changed world - be it fighting inequality or climate change.

Asian stocks extend gains as vaccine hopes support global reopening
Business

Asian stocks extend gains as vaccine hopes support global reopening

By Lawrence Delevingne BOSTON (Reuters) - Asian shares rose on Wednesday as hopes for a successful coronavirus vaccine lifted expectations of a swift reopening of the global economy, which would help the region's heavily trade-dependent markets.