World stocks fall on US-China tension and Covid-19 lockdowns

London/Singapore — Global stocks slipped on Tuesday, oil sagged and a safety bid supported the dollar as simmering China-US tensions and new coronavirus restrictions in California kept a lid on investor optimism with earnings season getting under way.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.9%. Chinese stocks were down despite better-than-expected trade numbers. The US dollar firmed marginally. “It's not just the tempo which is picking up, but the aspect of so many areas being pulled in to the dispute,” said Vishnu Varathan, head of economics at Mizuho Bank in Singapore.

The return of restrictions in California also has markets on edge about whether the coronavirus can wreak more economic harm. Global infections have surged by one-million in five days, and top 13-million.Oil prices, a proxy for global energy consumption and growth expectations, reflected the concerns. US crude futures fell 1.5% to $39.52 per barrel and Brent futures fell 1.3% to $42.16 per barrel.

Currency markets hemmed the dollar in a tight range. Against a basket of currencies, the dollar index was last up 0.1% at 96.662. The euro was down 0.1% against the dollar at $1.1331.

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