US stocks mixed amid rising Covid-19 concerns


Global stocks lagged and the dollar advanced in volatile markets on Monday, with sentiment hit by increasing Covid-19 cases, delays in vaccine supplies and uncertainty over a $1.9-trillion US stimulus plan.

Equity markets have scaled record highs in recent days on bets vaccines will start to reduce infection rates worldwide and on a stronger US economic recovery under President Joe Biden.

However, investors are wary about towering valuations amid questions over the efficacy of the vaccines in curbing the pandemic and as US lawmakers continue to debate a coronavirus aid package.

“The risk for these markets is that, after a bumper couple of months, investors may start to wonder whether they’re looking a little frothy,” said Craig Erlam, senior market analyst at OANDA Europe.

US stocks were mixed. The Nasdaq index hit a record high on hopes of bumper earnings later this week from mega-cap technology companies but the Dow Jones Industrial Average index struggled to keep pace.

The Dow Jones Industrial Average fell 36.98 points, or 0.12 per cent, to 30,960, the S&P 500 gained 13.89 points, or 0.36 per cent, to 3,855.36 and the Nasdaq Composite added 92.93points, or 0.69 per cent, to 13,635.99.

European shares closed at two-week lows as a slump in German business morale underscored the damage from tighter Covid-19restrictions.

The pan-European STOXX 600 index reversed early gains and finished 0.8 per centlower. The German DAX fell1.7 per cent, France CAC 40 was down 1.6 per centand the UK’s FTSE 100declined 0.8 per cent.

The MSCI world equity index, which tracks shares in 49 nations, rose 1.46 points or 0.2 per cent, to 668.15.

All eyes were on Washington, D.C., as US lawmakers agreed that getting Covid-19 vaccines to Americans should be a priority even as they locked horns over the size of the pandemic relief package.

Financial markets have been eyeing a massive package, though disagreements have meant months of indecision in a country suffering more than 175,000 Covid-19 cases a day with millions out of work.

“The immediate question now is when stimulus aid will be approved and how much?” asked Christopher Grisanti, chief equity strategist at MAI Capital Management.

The dollar advanced to a near one-week high against a basket of currencies, as volatility in stock markets around the globe sapped investors’ appetite for riskier currencies.

The dollar index, which tracks the greenback versus a basket of six currencies, rose 0.12 points or 0.1 per cent, to 90.358.The euro was last down 0.3 per cent at $1.2140

Gold prices pared gains on Monday as the dollar edged higher. Spot gold prices rose $2.7261 or 0.2 per cent, to$1,855.28 an ounce. US gold futures settled 0.1 per centlower at $1,855.20 per ounce.

As global Covid-19 cases inched toward 100 million, with more than 2 million dead, investors digested mixed news on the progress of vaccine roll-outs.

Moderna Inc said it believes its Covid-19 vaccine protects against new variants found in Britain and South Africa. Moderna shares rose 10.3 per cent.

AstraZeneca is not doing enough to try to resolve a dispute over delayed Covid-19 vaccine deliveries to the European Union, the bloc’s top health official said, as news emerged the drugmaker is also facing supply problems elsewhere. US investors were also awaiting a busy earnings week, with tech giants Apple Inc, Facebook Inc, Tesla Inc and Microsoft Corp all due to report results. Sentiment in Asia was boosted by a report that China had surpassed the US as the largest recipient of foreign direct investment in 2020, with $163 billion in inflows.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 9.21 points or 1.3 per cent.

In commodity markets, Brent crude settled at $55.88a barrel, up 47 cents or 0.9 per cent. US crude ended 50 cents,or 1 per cent, higher at $52.77 a barrel.


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