The S&P 500 index SPX fell 2.8% to 3,331.84, clinching its first three-day losing streak in nearly three months with nearly 90% of all shares lower. The likes Apple AAPL, -6.72%, Microsoft MSFT, -5.41% and Amazon AMZN, -4.39% were among the Big Tech stocks to sink more than 4%, torpedoing broad market indexes. The Nasdaq composite, which is packed with tech stocks, dropped 4.1% and is down 10% since it set its last record high on September 2nd. Tech stocks have soared on expectations they can continue to deliver strong profit growth regardless of the economy and global health. The tech shares in the S&P 500 are still up nearly 23% for 2020 so far, and Amazon has rocketed 70.5%, despite the devastation to the economy from the pandemic.
Stocks in Europe opened with a tepid gain as we saw the Stoxx Europe 600 Index open sharply higher, led by banks and travel shares. The uptick could be attributed to the French President Emmanuel Macron’s government unveiling a 100 billion-euro ($118 billion) stimulus plan. This even led to the euro extending this week’s decline amid further signals the European Central Bank is concerned with the strength of the currency. A major key event to look out for tomorrow would be the release of the Euro-zone retail sales data for the month of July.
Brent crude extended its losses below $40/bbl amid further signs of a bleak short-term outlook. It was its biggest one-day drop in more than two months as growing doubts persist over the strength of the global economic recovery along with the recent continued market sentiment weakness witnessed amongst stocks globally. Futures in London fell 0.4% after dropping 5.3% on Tuesday to settle below $40 a barrel for the first time since June 15th. Factors like the end of the U.S. summer-driving season, Asia’s recent stalling demand recovery and increased supply from the OPEC+ alliance all point to a grim short-term outlook for oil prices now it seems. It would be fair to also include the worsening U.S.-China relations, probable delay concerns on a Covid-19 vaccine which have been a considerable factor in hurting the recent gains we have seen in crude.
The SSA Eurobond curve took a heavy hit yesterday, with ANGOLA taking the heaviest hit when compared to the likes of NIGERIA and GHANA. Prices on the ANGOLA curve, fell c.3.45pts on the average, the likes of NIGERIA and GHANA fell c.2.25pts on the average with the longer end of both GHANA and NIGERIA accounting for the most drop on their respective curves as we saw oil came under pressure.