In the U.S. Thursday, airlines, cruise and travel shares that had soared in recent weeks bore the brunt of the selling. The KBW Bank Index of financial heavyweights slid 9%, and energy producers joined a rout in oil.
While much of the equity selling owed to the frantic pace of the recent rally, sentiment did sour as signs mounted of a possible second wave of the pandemic. Houston, the fourth-largest American city, is girding for a resurgence. Still, Treasury Secretary Steven Mnuchin said the U.S. shouldn’t shut down the economy again even if there is another jump in coronavirus cases.
“Certainly there are going to be some second-wave concerns so it is right for the market to be worried about that,” Lori Heinel, deputy global chief investment officer, said on Bloomberg TV at State Street Global Advisors. “We also had seen an incredible rally from the bottom so the idea that investors might be looking to take some profits here is certainly what’s driving the sell-off as well.”
As restrictions lift across the U.S., more than 2 million people have now been infected. The localized surges have raised concerns among experts even as the nation’s overall case count early this week rose just under 1%, the smallest increase since March.
Elsewhere, crude oil edged lower and is on course for its first weekly decline since April.
Source: Bloomberg
Leave a Reply