GLOBAL MARKETS-Asian shares, oil slump as coronavirus fears take hold

Published 12/06/2020, 01:30 pm
Updated 12/06/2020, 01:36 pm
© Reuters.
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* Equities slump on resurgence of coronavirus infections

* Oil futures extend sell-off on demand worries

* Yuan slips against dollar as coronavirus rattles Asian FX

By Stanley White and Chibuike Oguh

TOKYO/NEW YORK, June 12 (Reuters) - Asian shares fell sharply on Friday after Wall Street and oil tumbled over growing concerns that a resurgence of coronavirus infections could stunt the pace of recovery in economies reopening from lockdowns.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS slid 1.3%. Australian stocks .AXJO dropped 1.74%, while shares in China .CSI300 fell 0.67%.

Oil futures slumped for a second consecutive trading session due to worries about weak global energy demand, which weighed on the currencies of oil producers and countries that rely on exporting commodities.

The Chinese yuan headed for its biggest daily decline in two weeks, underscoring investors' risk-averse mood in Asia.

The three major U.S. stock indexes fell more than 5% on Thursday, posting their worst day since mid-March, when markets were sent into freefall by the abrupt economic lockdowns put in place to contain the pandemic.

"All of a sudden the coronavirus, which has been an also-ran story for some days now, became more important as the virus began picking up in some states, and the market began thinking there may be delays to reopening," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.

U.S. stock futures, the S&P 500 e-minis ESc1 , rose 1.1% in Asia on Friday, but that did little to help sentiment.

Japan's Nikkei stock index .N225 slid 1.22%, and shares in South Korea .KS11 fell 2.24% as some investors booked profits from a recent rally in global equities.

Coronavirus cases have jumped in several U.S. states in recent days, raising concern among experts who say authorities have loosened restrictions put in place to contain the spread too early.

Cases in New Mexico, Utah and Arizona rose by 40% for the week ended Sunday, a Reuters tally shows. Florida and Arkansas are other hot spots. U.S. Federal Reserve released a gloomy economic outlook at the end of its two-day monetary policy meeting on Wednesday. Chairman Jerome Powell warned of a "long road" to recovery. data appeared to back up the Fed's projections, with jobless claims still more than double their peak during the Great Recession and continuing claims at an astoundingly high 20.9 million. crude CLc1 slid 1.87% to $35.66 a barrel, while Brent crude LCOc1 eased 1.43% to $38.00 per barrel in Asia on Friday hit by renewed concerns over demand and a large buildup of U.S. crude inventories. O/R

The Mexican peso MXN= and the Norwegian krone NOK= fell against the U.S. dollar as the decline in crude prices hurt currencies from oil-producing countries.

Commodity-linked currencies, the Australian AUD=D3 and New Zealand dollars NZD=D3 , snapped a three-week run of sharp gains.

In the onshore market, the yuan CNY=CFXS fell 0.3%, headed for its biggest daily decline since May 27.

The 10-year U.S. Treasury yield US10YT=RR edged up slightly to 0.6853% on Friday. US/

Bond prices were well supported after they rallied following the Fed's commitment on Wednesday to years of extraordinary support to counter the economic fallout from the pandemic.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Global assets

http://tmsnrt.rs/2jvdmXl Global currencies vs. dollar

http://tmsnrt.rs/2egbfVh Emerging markets

http://tmsnrt.rs/2ihRugV MSCI All Country Wolrd Index Market Cap

http://tmsnrt.rs/2EmTD6j

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Neil Fullick and Jacqueline Wong)

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