Paramount plans November layoffs in $2 billion cost-cutting move - NYP
* Pompeo says 'significant evidence' virus emerged from lab
* European stocks fall
* Oil prices slip
* U.S. futures in negative territory
By Julien Ponthus
LONDON, May 4 (Reuters) - European stock markets and oil
prices fell on Monday as a spat between top U.S. officials and
China over the origin of the coronavirus fuelled fears of a new
trade war, derailing a rebound in global markets.
European shares .STOXX opened down 2.5% with U.S. stock
futures ESc1 trading close to 1% in the red.
Earlier, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS fell 2.5%, pulled down by Hong
Kong where the Hang Seng .HSI returned from a two-session
holiday with its biggest drop in six weeks.
U.S. Secretary of State Mike Pompeo said on Sunday there was
"a significant amount of evidence" that the virus emerged from a
laboratory in the central Chinese city of Wuhan. Pompeo did not provide evidence or dispute an earlier U.S.
intelligence conclusion that the virus was not man-made.
An editorial in China's Global Times said he was "bluffing"
and called on the United States to present its evidence.
"Concern on the potential for another flare up between the
US and China is dominating price action", commented RBC
strategist Adam Cole in a morning note.
Simon Black, head of investment management at wealth
management firm Dolfin said investors were also adjusting their
forecasts over the depth of the economic damage inflicted by the
pandemic.
"It's also the economic reality sinking in", he said, adding
that the rebound of over 20% from lows hit in March by global
equities was likely not sustainable.
Companies listed on the pan-European STOXX 600 .STOXX are
currently expected to report a 40% decline in earnings in the
second quarter. Manufacturing activity in the euro zone collapsed last month
as government-imposed lockdowns to stop the spread of the new
coronavirus forced factories to close and consumers to stay
indoors, a survey showed on Monday. "We've just come off a rally of hopes, not a rally on
fundamentals", Black said, pointing to the massive monetary and
fiscal stimulus pledged by governments and central banks around
the world.
Recent economic data paints a dire picture of the global
economy after weeks of lockdowns.
In the United States, manufacturing plunged to an 11-year
low last month, consumer spending collapsed, and some 30.3
million Americans have filed claims for unemployment.
Oil prices fell again, paring last week's gains, on worries
a global oil glut may persist even as coronavirus pandemic
lockdowns start to ease.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell
to $18.66 a barrel while Brent crude LCOc1 futures were down
1.7% at $26, after touching a low of $25.50. Brent rose about
23% last week following three consecutive weeks of losses.
In currency markets, the dollar rose 0.1% to 99.38 against a
basket of currencies =USD while the euro EUR= was down 0.48%
at $1.0930.
The safe-haven yen JPY= fell 0.2% to 106.72 per dollar.
Global coronavirus cases have surpassed 3.5 million and
deaths have neared a quarter of a million, according to a
Reuters tally.
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