GLOBAL MARKETS-Surge in coronavirus cases set to shake Asian markets

By Pete Schroeder
Oct 29 (Reuters) - Asian stocks were set to join a global
sell-off on Thursday as worries about surging coronavirus cases
in Europe and the United States sent investors scrambling for
safe-haven assets.
Australia's ASX 200 .AXJO fell 1.73% in early trade, while
Hong Kong's Hang Seng index futures .HSI .HSIc1 were off
0.8%.
Japan's Nikkei 225 futures NKc1 were up 0.24% but down
1.23% from the underlying index's .N225 close on Wednesday.
MSCI's gauge of stocks across the globe .MIWD00000PUS was
down 2.89%.
Surging coronavirus cases in the United States and Europe
were a growing concern as French and German leaders announced
new lockdown measures to combat rising infections. Worsening
matters for investor enthusiasm were dwindling hopes for any
imminent U.S. economic relief package with a presidential
election less than a week away.
"Risk sentiment took a nose dive on Wednesday amid more
concern around the spread of COVID-19 and renewed restrictions
in Europe," ANZ analysts wrote in a note. "This was seen
alongside ongoing concerns about failure to agree on U.S. fiscal
aid before the election next week, adding to a weak economic
picture."
U.S. and European stocks faced a brutal trading day on
Wednesday with major Wall Street indices down 3% and the Dow at
its lowest levels since late July. Energy and technology stocks
led the declines.
The Dow Jones Industrial Average .DJI fell 3.43%, the S&P
500 .SPX lost 3.53%, and the Nasdaq Composite .IXIC dropped
3.73%. Wall Street's "fear gauge" is on pace for its biggest weekly
jump since March, when the pandemic took off in the United
States. The Cboe Volatility Index .VIX surged on Wednesday to
its highest level since June, ending at 40.28. Looming large ahead is Thursday's advance report on U.S.
third-quarter economic growth, with analysts expecting record
growth but not enough to make up for the hit from the pandemic.
A closely watched estimate model used by the Atlanta Federal
Reserve shows third-quarter growth at a 37% annualized pace,
which would only account for about 71% of the $2.2 trillion in
lost output so far in 2020. Oil also took a big hit Thursday, falling over 5% to a
four-month low as coronavirus concerns weighed on demand
expectations. Brent LCOc1 futures fell $2.08, or 5.1%, to
settle at $39.12 a barrel, while U.S. West Texas Intermediate
(WTI) crude CLc1 fell $2.18, or 5.5%, to $37.39. Investors seeking a safe-haven moved into the greenback with
the dollar index =USD rising 0.3% against a basket of six
currencies. The flow to the dollars weighed on gold with the yellow
metal XAU= settling down 1.56% at $1,877.06 per ounce, after
falling as much as 2% on Wednesday. Benchmark 10-year notes US10YT=RR last rose 1/32 in price
to yield 0.7743%.

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