Asian stocks fall, Europe set to follow on doubts over coronavirus drug

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A man wearing a mask to help stop the spread of the new coronavirus walks past an electronic stock board showing Japan's Nikkei 225 index at a securities firm in Tokyo. - AP
A man wearing a mask to help stop the spread of the new coronavirus walks past an electronic stock board showing Japan's Nikkei 225 index at a securities firm in Tokyo. - AP

Tokyo - Asian shares are lower on Friday after an early rally on Wall Street suddenly vanished.

By Stanley White and Katanga Johnson

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Published: Fri 24 Apr 2020, 10:31 AM

Last updated: Fri 24 Apr 2020, 12:50 PM

Asian shares and US stock futures fell on Friday, spurred by doubts about progress in the development of drugs to treat Covid-19 and new evidence of US economic damage caused by the coronavirus pandemic.
MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.4 per cent. US stock futures, the S&P 500 e-minis, were down 0.56 per cent.
Shares in China, where the coronavirus first emerged late last year, fell 0.79 per cent.
Euro Stoxx 50 futures were down 2.23 per cent, German DAX futures slipped 2.19per cent and FTSE futures fell 1.36 per cent.
The S&P 500 and the Nasdaq turned negative at the close on Thursday after a report that Gilead Sciences Inc's antiviral drug remdesivier had failed to help severely ill COVID-19 patients in its first clinical trial.Gilead said the findings were inconclusive because the study conducted in China was terminated early.
Wall Street stocks finished almost flat on Thursday as oil prices bounced again, while the US reported another bruising round of jobless claims as a result of widespread coronavirus shutdowns. At the closing bell, the Dow Jones Industrial Average stood at 23,511.69 up 0.2 per cent.
The broad-based S&P 500 shed 0.1 per cent to 2,797.66, while the tech-rich Nasdaq Composite Index was essentially unchanged at 8,494.75
The markets' sensitivity to news related to the medical treatment of Covid-19 reflected investors' desperation for a sign of when the global economy might start returning to normal, Tim Ghriskey, chief investment strategist at New York-based wealth management firm Inverness Counsel.
"Any piece of bad news is likely to rattle the market," Ghriskey said. "Investors are keen for a semblance of hope that they can soon crawl out of their homes and get on with some form of normal life, even if with trepidation and fear."
US business activity plumbed record lows in April, mirroring dire figures from Europe and Asia as strict stay-at-home orders crushed production, supply chains and consumer spending, a survey showed.
The US House of Representatives on Thursday passed a $484 billion bill to expand federal loans to small businesses and hospitals overwhelmed by patients.
President Donald Trump, who has indicated he will sign the bill, said late Thursday that he may need to extend social distancing guidelines to early summer.
MSCI's gauge of stocks across the globe shed 0.24per cent. In Japan, shares in the Nikkei stock index slid 0.84per cent amid lingering concern about the spread of infections before the Golden Week public holidays.
Shares in South Korea, which has won recognition for its aggressive measures to contain the coronavirus, fell 1.11per cent. Australian shares bucked the trend, rising 0.71per cent due to gains in the energy and resources sector.
Oil prices extended a tentative rebound from a price collapse this week that pushed US crude futures into negative for the first time ever, but investors remain concerned about weak energy demand and excess supplies of crude.
US crude ticked up 4.85per cent to $17.30 a barrel, while Brent crude rose 3.98per cent to $22.18 per barrel in Asia as some oil producers said they will bring forward output cuts.
The outlook remains dim because global energy demand has evaporated due to business closures and travel curbs aimed at slowing the pandemic. In addition, some countries are running out of space to store the crude oil that they are not using.
The dollar headed for weekly gains against the Norwegian crown, the Canadian dollar, and the Russian rouble as investors chose to sell the currencies of major oil producers and keep their funds in dollars.
Elsewhere in the currency markets, the euro headed for its second weekly decline against the dollar after the European Union agreed on Thursday to set up a joint financial fund of up to 2 trillion euros to help recover from the pandemic but delayed a decision on the details of the programme until the summer.
The yen was little changed at 107.67 against the dollar. Japan's currency fell briefly after the Nikkei newspaper reported the Bank of Japan will consider unlimited government bond purchases at a policy meeting next week Monday. - Reuters, AFP


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