US futures, Asia stocks slip as Trump tests positive for COVID-19

Home Business US futures, Asia stocks slip as Trump tests positive for COVID-19
US futures, Asia stocks slip as Trump tests positive for COVID-19

HONG KONG: US futures and most Asian equities sank on Friday (Oct 2) after Donald Trump announced he and his wife had tested positive for coronavirus.

The news compounded uncertainty on trading floors, where investors were already in a pessimistic mood owing to US lawmakers' failure to pass a new stimulus bill.

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"Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!" Trump tweeted in the early hours.

The president had taken a test after his close White House aide Hope Hicks had tested positive earlier in the day, meaning he will now have to go into quarantine just weeks before one of the most crucial elections the country has ever had.

His doctor Scott Conley said the couple intended to stay at the White House "during their convalescence."

"Rest assured I expect the president to continue carrying out his duties without disruption while recovering, and I will keep you updated on any future developments," he added.

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The White House cancelled a planned campaign rally in the crucial swing state of Florida on Friday, and 32 days before the Nov 3 vote against Democrat Joe Biden, it also looked certain Trump would have to cancel a slew of other trips scheduled for this weekend and next.

The news sent Dow futures tumbling 1.9 per cent, while the S&P 500 shed 1.9 per cent. Safe-haven assets also rallied, with the Japanese yen – a go-to in times of turmoil and uncertainty – rose to 105 per US dollar, from 105.60 earlier in the day.

The greenback climbed against higher-yielding currencies including the Australian dollar and South Korean won.

Japan's Nikkei sank 0.7 per cent, reversing earlier gains as traders resumed trading following Thursday's market shutdown caused by a technical fault.

Sydney, Singapore and Bangkok were all down more than one per cent, while Jakarta was also in the red.

However, Manila and Wellington both rose.

Axi analyst Stephen Innes said the announcement would likely increase Biden's already good chances of winning.

"The risk-off reaction to Trump's positive COVID-19 test feels like the last of the Biden pricing is getting done," he said in a note. "The quarantine will mean he misses three swing state rallies – with critical Florida among them."

Sentiment had already been weak as hopes for a new US rescue package fade.

Democrats pushed their latest US$2.2 trillion proposal through the House, where they hold a majority, but without any opposition support, there is no chance it will be agreed by the Republican-dominated Senate.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin held a series of talks on Thursday to find a way through the deadlock but when asked whether a chance still remained for an agreement, Pelosi replied: "I don't know."

OANDA analyst Jeffrey Halley added that "having built hopes higher steadily over the past few sessions that the US Republicans and Democrats were edging closer to a new fiscal stimulus package, a sense of deja vu has swept markets".

He said thatRead More – Source

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