Stocks collapsed worldwide as oil prices plummeted

Stocks collapsed worldwide as oil prices plummeted

U.S. futures declined alongside the European and Asian stocks on Tuesday due to the news about the critical condition of North Korea’s dictator Kim Jong Un. U.S. and South Korean officials gave differing accounts of Kim Jong Un’s state. Jeffrey Halley, the market analyst at Oanda Asia Pacific, noted that the uncertainty about who succeeds him in North Korea is the great unknown.

The stock markets are nervous. Industry sectors ended in the red with energy companies leading the decline. The Stoxx Europe 600 Index tumbled down for the first time in four days. Contracts on the three major American gauges also fell significantly. The risk of instability in the region is a big red flag for investors.

What about collapsed oil prices and its influence on the market?

The oil prices plunged down this week, dropping to a four year low. That, with the uncertainty about the health of North Korea’s dictator and the coronavirus pandemic, caused a worldwide decline in the stocks. The Stoxx Europe 600 Index fell by 2.2%, and the S&P 500 futures dropped by 1.4%.

West Texas Intermediate’s crude May contract traded at minus $5.78 a barrel. West Texas oil’s June contract also collapsed as much as 42% on Tuesday before stopping around $16. Traders fear that those who take physical delivery of crude in the coming days may not find any outlet or storage for those barrels. Gold also slid 1.2% to $1,675.68 an ounce.

In the U.S., the outbreak is slowing in hard-hit areas, but the authorities fear that the danger hasn’t passed yet. President Donald Trump announced that he’d sign an executive order temporarily suspending immigration into America while the country tries to contain the spread of the coronavirus. Meanwhile, investors will be looking to corporate earnings for more insight into the impact of the coronavirus.

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