The Monday Market Minute
- Global inventories are declining as Britain identifies a new COVID variant activating strict lockdown orders for London and travel restrictions with the rest of Europe.
- Prime Minister Boris Johnson says the new variant is 70% more transferable than its predecessor, and may already be active in other parts of the world.
- US lawmakers agreed on a $ 900 billion coronavirus aid package late Sunday, with votes in both the House and Senate expected later in the day.
- The US dollar index is rising overnight in defensive trading, while gold hits its six-week high at $ 1,896.00 an ounce.
- Tesla shares are slipping ahead of the S&P 500’s debut after closing at a record high of $ 695 per share in active Friday trading.
- US stock futures point to a steep opening bubble on Wall Street Monday towards a week of shortened holidays that includes an early close on Thursday afternoon.
US stock futures fell sharply on Monday, as the dollar rose and gold traded at a six-week high as markets reacted to the discovery of a new coronavirus variant in the UK that is spreading faster and potentially more dangerous than its predecessor. .
Prime Minister Boris Johnson said the new strain could be 70% more transferable, using his discovery to justify new Christmas lockdown orders for London that will shut down all non-essential shops and services and severely restrict travel to and from the capital.
Britain’s European neighbors have also introduced strict travel bans, with France closing key entry gates and canceling all arrivals from flights from UK airports, a move rivaled by most European Union member states.
The discovery of a new COVID strain seems to offset market optimism for a $ 900 coronavirus relief package agreed last night by Washington lawmakers that will ultimately bring $ 600 in direct payments to U.S. families and the unemployment benefits by $ 300 will increase. Congressional lawmakers will vote on the package today, with the Senate likely to follow suit shortly after.
Futures contracts pegged to the Dow Jones Industrial Average, however, will drop more than 410 points at the start of the trading day, while contracts pegged to the S&P 500 are priced at an opening bubble cut of 62 points. Nasdaq Composite futures, meanwhile, are showing a drop of 175 points.
In terms of individual stock movers, Tesla (TSLA) – Request report stocks were active prior to the debut of the S&P 500, declining 45% to an opening price of $ 663.55 each after hitting a record high of $ 695.00 per share on Friday and closing at a market value of $ 658.8 billion.
Modern (MRNA) – Request report shares, meanwhile, are up 1.3% in pre-market trading after the Food & Drug Administration approved Emergency Use Authorization for its coronavirus vaccine on Saturday.
The US dollar index, which tracks the greenback against a basket of six global currencies, was up 0.8% in overnight trading at 90,727 as investors sought cover amid headlines related to the UK’s isolation and the new London lockdown, while the benchmark 10-year Treasury yields fell to 0.908%.
Global oil prices also plummeted on the news, with US crude oil contracts for delivery falling $ 1.68 to $ 47.56 a barrel in February and Brent contacts for the same month from $ 1.91 to $ 50.35 a barrel.
European stocks were also significantly weaker, falling 2.5% from its 10-month high during Monday’s early trading, with Germany’s trade-sensitive DAX index falling 2.8%.
The UK’s FTSE 100 was down 2.2% during early London trading, supported in part by a weaker pound, which fell nearly 2 cents against the US dollar to 1.3275.
Japan’s Nikkei 224, overnight in Asia, ended the session 0.18% lower at 26,714.42 points, while the region-wide MSCI ex-Japan index fell 0.7% on its way into the last hours of trading.