World shares stall near four-month high

Nagging coronavirus nerves temper recent recovery run

LONDON:

World shares stalled near a four-month high on Friday and the industrial bellwether metal copper scuffed its longest weekly winning streak in nearly three years, as nagging coronavirus nerves tempered the recent recovery run.

The market rally, fuelled by Thursday’s record US jobs numbers, largely blew itself out after a record daily total of new US Covid-19 cases, though news of the fastest expansion in China’s services sector in over a decade kept Asia’s tail up early in the day.

Chinese shares had charged to their highest level in five years, helping the pan-Asian indices to four-month peaks, so the sight of European markets stalling left traders floundering, especially with no Wall Street to pick things up again because of a US market holiday.

Currency and commodity markets were also subdued after an otherwise strong week for confidence-sensitive stalwarts such oil, copper, sterling and the Australian dollar, which all struggled on Friday.

More than three dozen US states are now seeing increases in Covid-19 cases, including Florida, where they have leapt above 10,000 a day. And while Europe is largely easing restrictions, some places have to keep them or re-impose them.

“I think infection rates and fears of localised lockdowns have doused some of the enthusiasm,” said Societe Generale strategist Kit Jukes. “We have three elements now; vaccine hopes, decent data in most places but also the return of infection rates, which can make you nervous.”

London, Paris and Frankfurt stock markets were down 1.2%, 0.4% and 0.8% respectively as trading began to wind down, although all were up for the week.

The euro and pound were also fractionally lower, though it was barely noticeable thanks to the dollar’s second dip of the week.

Published in The Express Tribune, July 4^th, 2020.

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