Stocks plunge in Asia with pandemic declared, Trump travel ban; STI down 3.6%

[The_King]

TOKYO (REUTERS, BLOOMBERG) - Stocks plummeted in Asia on Thursday (March 12) after United States President Donald Trump suspended all travel from Europe for 30 days, a day after the US Dow Jones industrials entered bear market territory and world health officials declared the coronavirus a pandemic.

Shares in  Singapore, Australia, Japan, the Philippines and Indonesia have now also entered bear markets, as well as a gauge of euro-area stocks and benchmarks in Italy, Germany, Spain, France and the UK. Stocks are said to enter a bear market when they fall at least 20 per cent from a recent peak. The Dow reached that unwelcome milestone on Wednesday, breaking an 11-year bull run.

It came after the WHO pandemic declaration on Wednesday rattled traders who were already on edge, The Trump travel ban ratcheted up fears the spreading virus will plunge the global economy into a recession. 

 

Dow futures dropped as Mr Trump's economic plan disappointed investors, stopping short of a detailed rescue package.. He announced the US government will give individuals and small and mid-sized businesses a three-month tax holiday to try to fight the economic impact of the coronavirus, and give affected companies US$50 billion (S$69.8 billion) more in low-interest loans.

US stock index futures plunged nearly 5 per cent, almost hitting their circuit breakers for the second time in a week.

Signs that companies in the hardest-hit industries were drawing down credit lines to battle the effects of the virus on their businesses added to anxiety. The haven bid in Treasuries showed signs of returning after it gave way to a rush of selling on Wednesday, with traders scrambling to unload their most easily traded assets - even the safest ones.

 

Japan’s Nikkei index plunged 4.4 per cent while Australia’s S&P/ASX index dived 7.4 per cent, the worst one-day drop since the financial crisis in 2008.

South Korea’s Kospi index sank 3.9 per cent while Hong Kong’s Hang Seng index fell 3.8 per cent. The Shanghai Composite Index ended down 1.5 per cent.

Singapore stocks were also caught up in the maelstrom, with the Straits Times Index (STI) falling more than 20 per cent from its 52-week high of 3,415.18. The STI was trading down 98.74 points or 3.6 per cent to 2,684.98 as of  3:56pm, as it struggled to pare losses. 

Thailand was the worst performer in Asia with the SE index nosediving 10.8 per cent while the Philippines lost 9.7 per cent.

On Wednesday, the S&P 500 lost 4.89 per cent while the Dow Jones Industrial Average fell 5.86 per cent to extend its fall from a record peak hit a month ago to more than 20 per cent, entering what is known as a "bear market".

The US dollar slid in another seismic shift to price in more US interest rate cuts on Thursday, after Trump disappointed markets with a coronavirus plan light on details.

The greenback dropped 1 per cent to 103.32 yen, fell as much as 0.6 per cent to US$1.1333 against the euro and lost 0.6 per cent to the safe-haven Swiss franc.

 

Some safe-haven assets gave up recent gains, a move that some market players suspect is a desperate bout of profit-taking to make up for losses made elsewhere.

Gold dipped to US$1,640.7 per ounce from Monday's high above US$1,700. It later edged up 0.1 per cent at US$1,636.

The 10-year U.S. Treasuries yield fell 6 basis points to 0.760 per cent, though it is still more than 40 basis points above a record low of 0.318 per cent touched on Monday.

The two-year yield fell 6 basis points to 0.438 per cent, but stood well above Monday's low of 0.251 per cent.

Fed fund rate futures are pricing in a rate cut of at least 0.75 percentage points and about a 30 per cent chance of a 1.0 percentage point cut at a policy review on March 17-18.

Oil prices were hit by intensifying price war between Saudi Arabia and Russia, on top of fears of sharp slowdown in the global economy.

 

Saudi Arabia promised to raise oil output to a record high in its standoff with Russia. The United Arab Emirates followed Saudi Arabia in promising to raise oil output to a record high in April.

US West Texas Intermediate (WTI) crude shed 4.9 per cent to US$31.36 per barrel.

With additional information from The Straits Times

[socrates469bc]

huat ah!!!!!!

 

On 3/7/2020 at 10:40 AM, socrates469bc said:

...... heng i didnt listen to my broker to add ocbc at sgd11/share or buy genting singapore when STI at 3100 level.

 

now can only play sgx futures and commodities.

 

wahahahahahaha

 

[The_King]

yes, gold gold gold up up up

[socrates469bc]

3 minutes ago, The_King said:

yes, gold gold gold up up up

 

there r always jokers who have itchy fingers.

 

since i havent smell blood in the market yet, i hold cash or play futures.

 

wahahahahhahaha

Edited March 12, 2020 by socrates469bc

[The_King]

25 minutes ago, socrates469bc said:

 

there r always jokers who have itchy fingers.

 

since i havent smell blood in the market yet, i hold cash or play futures.

 

wahahahahhahaha

Misfrumini also holding cash.

 

Muahhahahaha