Stock markets fluctuated on Monday around the globe. In Europe, the Stoxx 600 Index changed insignificantly, while the MSCI Asia Pacific Index plummeted down by 1.3%.
Meanwhile, some futures surged forward in the United States. On Monday, the S&P 500 gained 0.2%, and the Dow Jones Industrial Average jumped by 0.7%. On the other hand, the Nasdaq Composite dropped down by 0.3%.
Gilead Sciences Inc. rallied after stating that it will charge the U.S. government and other developed countries $390 per vial for its coronavirus-fighting drug. Boeing Co. Gained as well. This is during the time that U.S. aviation regulators announced that they’d approved a set of test flights on the 737 Max.
However, Facebook Inc. tumbled down after Diageo Plc, Starbucks Corp. and other businesses joined the growing number of brands planning to stop spending on social media for a time.
Fears of renewed pandemic hurt global markets
U.S. stocks have experienced rapid ups and downs since last week as the fears of new pandemic wave jostled investors. It seems the pandemic will continue longer than expected. The World Health Organization reported the largest number of coronavirus infections for a single day, causing markets to whipsaw.
Confirmed virus cases exceeded 10 million, and global deaths surpassed 500,000 worldwide. The majority of investors see a 20% fall in the stock market as more likely than a similar gain.
Some investors hope that U.S. companies’ earnings recession may be less severe than analysts expect. But they estimate that second-quarter earnings for the S&P 500 will collapse by 44% after a first-quarter decline of 18%.
Equity markets are under pressure given fears of a spike in coronavirus cases – stated Sebastien Galy, the senior macro strategist at Nordea Investment Funds. He added that many investors have to sell some equities to rebalance their portfolios at the end of the month, partially locking in some gains.
However, Galy thinks that this pressure should ebb with the start of the new month. Economic data should then start to show some signs of a recovery.