TPI Composites files for Chapter 11 bankruptcy, plans delisting from Nasdaq
(Adds U.S. market open, byline, dateline; previous LONDON)
By Herbert Lash
NEW YORK, June 15 (Reuters) - Fears of a second wave of
COVID-19 infections rocked world markets on Monday, knocking
down oil prices and a gauge of global equity performance more
than 2% at one point, as investors grappled with how to assess
the economic recovery.
China re-introduced restrictions in some areas after Beijing
reported its biggest cluster of new infections since February,
and new cases and hospitalizations in record numbers also swept
through more U.S. states, including Florida and Texas.
Data showed factories in China stepped up production for a
second straight month in May, giving investors hope, but also
showed sustained contractions in retail sales and investment,
suggesting many sectors were still struggling. News elsewhere also was discouraging. Germany's Economy
Ministry said economic output will fall further in the second
quarter than in the first, and it warned the recovery later this
year and beyond would be sluggish. "Market are pricing a too-optimistic recovery, in my
opinion, and there could be a reality check coming rather sooner
than later," said Stephane Ekolo, an equity strategist at TFS
Derivatives in London.
Equity markets slid last week following a global rally since
late March, fueled by central bank and fiscal stimulus and
optimism about countries gradually lifting lockdowns.
Many analysts have warned about the disconnect between a
global recession and optimism in stock markets, with the Nasdaq
hitting record highs even as U.S. unemployment surged.
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.88%, reflecting steep losses overnight in Asia. The
pan-European STOXX 600 index .STOXX lost 0.36% after falling
more 2.5% in early trading.
Japan's Nikkei .N225 closed down 3.5% and South Korean
shares .KS11 tumbled 4.8%.
On Wall Street, the Dow Jones Industrial Average .DJI fell
260.98 points, or 1.02%, to 25,344.56. The S&P 500 .SPX lost
21.09 points, or 0.69%, to 3,020.22 and the Nasdaq Composite
.IXIC dropped 21.29 points, or 0.22%, to 9,567.52.
Oil prices fell. U.S. crude CLc1 fell 1.82% to $35.60 per
barrel and Brent LCOc1 was at $38.53, down 0.52% on the day.
"A fresh wave of cases will certainly raise worries that a
recovery in demand may take even longer than initially thought,"
said ING's head of commodities strategy, Warren Patterson.
U.S. Treasury yields fell as the renewed concerns over the
spread of the coronavirus dented risk appetite and boosted
demand for safe-haven bonds.
Benchmark 10-year notes US10YT=RR fell 1.5 basis points to
yield 0.6903%.
Euro zone bond yields edged down as investors bought safer
assets such as government bonds.
Germany's 10-year bond yield was near a three-week lows at
-0.45%.
The dollar fell against a basket of trading currencies.
The dollar index =USD fell 0.17%, with the euro EUR= up
0.16% to $1.1272. The Japanese yen JPY= weakened 0.09% versus
the greenback at 107.46 per dollar.
"The market was pricing in a V-shape recovery. This can't be
the case if there is indeed a second wave, the best scenario is
U-shaped", said Steven Leung, executive director for
institutional sales at Uob Kay Hian.
Worldwide coronavirus cases have crossed 7.86 million with
430,501 deaths, according to a Reuters tally.
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Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
Asset performance vs outbreak https://tmsnrt.rs/2YF3T1T
Stocks and oil versus COVID-19 cases https://tmsnrt.rs/3cXWNdO
GRAPHIC-World FX rates http://tmsnrt.rs/2egbfVh
GRAPHIC-MSCI All Country World Index Market Cap http://tmsnrt.rs/2EmTD6j
GRAPHIC-Emerging markets http://tmsnrt.rs/2ihRugV
GRAPHIC-Global assets in 2020 http://tmsnrt.rs/2jvdmXl
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