World stocks fall on rising Covid cases

Published On: September 19, 2020Categories: Stocks & Shares1.8 min read

London, Frankfurt and Paris stock markets fell, while all the major US indices dropped again

Global stock markets concluded the week on a lacklustre note Friday as investors fretted over renewed coronavirus restrictions, the stuttering global economic recovery and US lawmakers’ failure to agree on new stimulus measures.

In Europe, London, Frankfurt and Paris stocks all lost ground, while all three major US indices fell again to end the week with losses.

The downcast Wall Street session came as the United States cracked down again on TikTok, heightening tensions with China.

Continued drama in Washington added to the mix, amid the looming highly contentious presidential election and a non-existent fiscal relief package, a note from Charles Schwab said.

But it is the ongoing Covid-19 pandemic that continues to spook investors, and a swathe of fresh spikes around the world prompted the reimposition of containment measures including lockdowns.

Coronavirus dominated the session, said Spreadex analyst Connor Campbell, saying a raft of new restrictions, notably in northeastern England, penalized stocks. Owner of British Airways IAG was hit particularly hard, giving up 14.6 percent in the latest sign of the virus’s blow to the aviation industry.

Britain’s government warned it could impose further restrictions across England to combat rising infections, noting hospitalization rates are doubling every eight days.

France has been seeing virus deaths trend upwards and hospital admissions rise, and Spain’s capital Madrid demanded government action as the virus threatened to overwhelm the city.

The threat of a second round of Covid-19 restriction has dented confidence, with the travel sector in particular feeling the heat as we head into the weekend, said Joshua Mahony, senior market analyst at online trading firm IG.

Worldwide, the respiratory disease has killed nearly 947,000 people since the outbreak emerged in China last December, according to a tally from official sources compiled by AFP, while more than 30.2 million cases have been registered.

Adding to the unease was Friday’s move by the Trump administration to ban downloads of popular video app TikTok and effectively block the use of the Chinese super-app WeChat on US national security grounds.

The clampdown follows through on a threat by Trump, who has claimed Chinese tech operations may be used for spying.

A deal which appeared to be taking shape would allow Silicon Valley giant Oracle to become the tech partner for TikTok, but some US lawmakers have objected to allowing ByteDance to keep a stake.

About the Author: Jonathan Adams

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