Global shares fall as Wall Street rally fizzles amid virus fears

Tokyo, April 24

Global shares extended losses on Friday as hopes faded for a quick turnaround for the global coronavirus pandemic.

France’s CAC 40 dropped 1.9 per cent in early trading to 4,368.03, while Germany’s DAX fell 1.8 per cent to 10,321.87. Britain’s FTSE 100 shed 1.5 per cent to 5,741.36. US shares were poised for losses, with the future for the Dow industrials down 0.3 per cent at 23,272.50. The future contract for the S&P 500 lost 0.4 per cent to 2,771.12.

Investor sentiment was again fragile as attention shifted to the economic damage the world is likely to suffer because of the pandemic, says Prakash Sakpal and Nicholas Mapa, economists at ING.

A report from the Financial Times that said an antiviral drug failed to improve conditions in patients in a Chinese clinical trial cast a shadow over hopes it might turn out to be a potential treatment for coronavirus patients.

The report cited documents published accidentally by the World Health Organization. Researchers said the sample size was too small to draw scientifically valid conclusions and the trial ended early.

The Foster City, Calif.-based company behind the drug, Gilead Sciences, said the data represented “inappropriate characterizations” of the China study.

“Investors will continue to be monitoring developments on the COVID-19 front with a setback on clinical testing for a treatment to the virus. Meanwhile, the US passed a fresh round of stimulus while oil prices continued to inch up slightly,” they said in a commentary.

Market players are also focusing on upcoming policy meetings at the Bank of Japan, the Federal Reserve and the European Central Bank for signs of what they may say about the state of global economies that appear on the brink of collapse.

Japan’s benchmark Nikkei 225 slipped 0.9 per cent to finish at 19,262.00. South Korea’s Kospi lost 1.3 per cent to 1,889.01, while Australia’s S&P/ASX 200 climbed 0.5 per cent to 5,242.60. Hong Kong’s Hang Seng fell 0.6 per cent to 23,831.33, while the Shanghai Composite lost 1.1 per cent to 2,808.53.

In India, the Sensex lost 0.5per cent to 31,689.62. Shares fell in Taiwan and Southeast Asia.

Toyota shares slipped 0.4 per cent in Tokyo after the Japanese automaker said vehicle production will be gradually ramped up in North America from May 4. Toyota Motor Corp., like many other automakers, have halted production around the world.

US benchmark crude shed 69 cents to $15.76 a barrel in electronic trading on the New York Mercantile Exchange. It rose 19.7 per cent to settle at $16.50 a barrel.

It has recovered after falling below $12 Monday, though it remains well below the roughly $60 level where it began the year. Brent crude, the international standard, gave up 51 cents to $24.28 a barrel.

The dollar inched up to 107.71 Japanese yen from 107.50 yen Thursday. The euro inched down to $1.0747 from $1.0777. AP