The FTSE moved 1 percent lower shorly after the opening bell, crystallising investor fears. After a brutal sell-off earlier this year, share prices had risen globally over the past three months, helped by massive stimulus around the world and hopes the worst of the pandemic was over.
“The second wave is becoming a theme for markets. The increase in states such as Florida and South Carolina is big enough to be labelled as second wave,” said Yoshinori Shigemi, global strategist at JPMorgan Asset Management.
“Whether there will be a lockdown may vary depending on region. It will be a tough decision for politicians. But they probably have no other choice if they are running out of hospital beds,” he said.
The pandemic is accelerating globally with the World Health Organization (WHO) reporting a record increase in global coronavirus cases on Sunday.
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FTSE LIVE: US stock futures erased losses and Asian stocks held flat on Monday
6.30pm update: Dow Jones Industrial Averge up by 144 points
The US stock market opened lower this morning, reflecting the sentiment in Europe and Asia.
The Dow Jones Industrial Average fell 6.38 points, or 0.02 percent, at the open to 25,865.08.
But now, it has reportedly jumped by 144 points, or 0.6%, to around 26,017.
Over the weekend, the US began reopening non-essential shops as lockdown measures eased.
But Lauren Goodwin, economist and multiasset portfolio strategist at New York Life Investments, warned businesses remain at risk if a second lockdown is reinstated.
She said: “Significant business and economic risks remain as long as the health risk is unmanaged. I
“n many U.S. states, COVID-19 case rates are rising, and [economic data] could quickly reverse if lockdowns are renewed or anxious individuals stay at home.”
5.30pm update: Cineworld receives £201m from private investors
The UK-based cinema chain is expected to reopen as early as next month as the cinemas were forced to close following the nationwide lockdown in March.
According to PA, the company has now received £201m from an unnamed private investor.
It said the deal with unnamed institutional investors “further strengthens the group’s balance sheet as cinemas begin to reopen around the world”.
Cineworld receives £201m funding from investor
5.04pm update: European indices fall into red amid COVID-19 fears
Fears of a second wave of the deadly COVID-19 pandemic has impacted the European market as it fell into red today.
The FTSE 100 ended 0.72pc lower at 6247.02 with the FTSE 250 also losing around 0.64pc to 17,573.44.
In Europe, the Frankfurt DAX and Paris CAC both shed 0.7pc.
The Dow Jones was lower in the late New York morning trading and gained back most of the ground lost at the opening.
David Madden of CMC Markets said: “The Americas, China, India and Germany have seen relatively sharp increases in new infections, and that has weighed on confidence for much of the session.
“The losses aren’t huge so traders are not that worried, but they are cautious that some of the good work that has been done in relation to suppressing the virus could be undone.”
3.30pm update: European stocks stuck on red
European stock markets are still stuck on red.
The stocks have struggled with the ongoing COVID-19 pandemic.
Both the DAX and CAC 40 indexes remain struggling.
3.20pm update: US existing home sales continue to fall
According to the National Associaton of Realtors, existing home sales in the US dropped to 3.91m in May.
The industry was down by 9.7pc month-on-month.
The fall is reportedly worse than economists had expected.
3.05pm update: 2,300 jobs at risk at JD Sports
The UK high street is facing ongoing struggles as JD Sports is the latest retail outlet to be on the brink of calling in administrators.
According to the Telegraph, around 2,300 jobs are at risk if the sports retailer goes into administration.
JD Sports is facing administration
2.30pm update: US stocks open lower
US stocks opened lower, reflecting the sentiment in Europe and Asia.
The Dow Jones Industrial Average fell 6.38 points, or 0.02 percent, at the open to 25,865.08.
The S&P 500 opened lower by 3.32 points, or 0.11 percent, at 3,094.42. The Nasdaq Composite dropped 0.63 points, or 0.01 percent, to 9,945.49 at the opening bell.
1.45pm update: US airline stocks wobble
Shares of airlines, one of the worst-hit sectors by the lockdowns, tumbled with United Airlines, JetBlue Airways and Alaska Air Group down between 2.1 percent and 4 percent in premarket trading.
American Airlines Group Inc tumbled 9 percent as it planned to secure $3.5billion in new financing by selling shares and convertible senior notes to boost liquidity.
“Investors are trying to calibrate the difference between an increase in new coronavirus cases against sequentially improving economic data,” Art Hogan, strategist at National Securities told reuters
“The concern right now is the possibility of partial reclosing of the economy as and when fresh cases flare up.”
1pm update: Markets in Europe turn negative while US futures climb before open
European markets turned negative by lunch time trading, as data continues to emerge that suggests Europe’s economy won’t be in for a quick rebound.
Confidence in US markets is despite damning numbers about a resurgence of the virus in various states.
The FTSE-100 index at 12:45pm was down 22.93 at 6269.67.
11.50am update: Factory output slumps
UK factory output suffered its worst quarter on record, as the economic effects of lockdown played out across the economy.
CBI reported in its monthly industrial trends survey that output dropped in 15 out of 17 sub-sectors. It also projected potential falls ahead, as the hope for a rapid recovery in some parts of the economy dwindles.
11.30am update: FTSE makes slight recovery, US futures rally
The FTSE regained lost ground, making a slight recovery to trade just above its opening levels.
US stock futures ticked up further, on investors hopes that the economic recovery would happen faster than has been predicted.
Jobs figures coming out of the US last week were slightly better than feared, a measure that has buoyed markets in the past.
11am update: London Stock Exchange chief named head of UK’s top financial regulator
The Treasury has announced that Nikhil Rathi has been named chief exec of the FCA.
Mr Rathi has been at the LSE since 2015, having previously served 11 years in the treasury.
Chancellor Rishi Sunak welcomed the appointment.
Businesses began to open last week, inspiring confidence in some investors.
10.20am update: Wirecard slides further
Stocks of the beleaguered German financial services provider Wirecard slid further today, as it admitted that it was likely that €1.9bn in missing cash that it has been trying to locate does not exist.
Shares opened 46 percent lower today, as a confidence-related sell off continued.
The company withdrew its financial results for 2019 and Q1 of 2020 amid an accounting scandal.
9.30am update: Glencore slides in London
London-listed shares of Swiss commodity miner Glencore fell as much as 5.8 percent to a three-week low after it said the Office of the Attorney General of Switzerland was investigating it for failure to have measures in place to prevent alleged corruption in the Democratic Republic of Congo.
Across Europe, stocks rebounded slightly from their opening retreat, but were still trading lower.
“The market is caught between fears of a second COVID-19 wave and improving (economic) data,” Stephen Innes, markets strategist at AxiCorp told Reuters.
“Financial conditions are easing and the early-June surveys have improved markedly, but with U.S. case counts on the rise, investors remain jittery and probably will until a vaccine is in hand.”
8.40am update: European stocks dip
European stocks dipped pretty much across the board this morning, with France’s CAC leading losses at nearly 0.9 percent lower.
The FTSE moved 0.7 percent lower mirroring the Europe-wide Stoxx 600 index.
8.30am update: Flock to havens
Gold futures prices reached their highest point in more than a month this morning as investors fled to safe haven assets. The delay in economic recovery is spooking investors, as new virus cases continue to appear.
Investors tend to buy gold, as riskier assets become more volatile.
Silver futures and the Japanese yen also rose.
“General risk aversion is helping the market, we are seeing pressure on growth exposed currencies and on share markets. Overall, there are concerns about increasing infection rates,” said Michael McCarthy, chief strategist at CMC Markets told Reuters.
7.50am update: US stock futures edge up
US stock futures tentatively edged up this morning, as investors waited for indications of the severity of new virus cases.
Dow futures rose 0.2 percent, while S&P 500 futures were up 0.3 percent ahead of market open at 2.30.
7.10am update: FX outlook
Against a basket of currencies, the dollar retreated from last weeks gains, falling 0.2% to 97.501.
The Pound enters the new week at 1.1044 against the euro, but analysts say it will be held back this week due to uncertainty surrounding Brexit talks, and investor scepticism about whether the Bank of England has done enough to support the UK economy.
This is Lucy Harley-McKeown taking over from Grace McRae.
6.11am update: US home prices to defy economic downturn
According to the June 9-19 poll of over 40 housing strategists, house prices will rise 3.0% this year and next, reuters reports.
Three months ago prices were expected to rise 3.4% and 3.2% respectively, making the forecast appear remarkably stable, given the economy is taking its worst hit on record due to the pandemic.
Additional reporting by Grace MacRae