LONDON: European shares fell again on Thursday, taking their cue from U.S. equity futures, which implied a lower open for Wall Street as cases of the coronavirus surged in the U.S.
"European stocks are now catching with the downward trend, dragged by a wave of profit warnings," said Stephane Ekolo global equity strategist at TFS Derivatives."U.S. futures are down due to fears the situation could worsen after California declared a state-wide emergency." U.S. stocks on Wednesday found relief in Joe Biden's performance in the campaign for the Democratic presidential nomination. Biden is considered less likely to raise taxes and impose new regulations than rival Bernie Sanders.Adding to the momentum was an approval by the U.S. House of Representatives of an US$8.3 billion funding bill to combat the spread of the coronavirus. The emergency legislation followed a surprise rate cut by the U.S. Federal Reserve on Tuesday.
The Federal Reserve and Bank of Canada have both responded by cutting interest rates by 50 basis points. Markets in the euro zone are pricing in a 90per cent chance that the European Central Bank will cut its deposit rate, now minus 0.50per cent, by 10 basis points next week.
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