US Indices Extend Drop on COVID19 Concerns

US Indices Extend Drop on COVID19 Concerns


Major US stock-index futures weakened further during the Asian session extending last week's sharp losses amid increasing woes over a second wave of Coronavirus outbreak. The new confirmed cases and hospitalized cases rose significantly over the past couple of days in the United States, triggering fears of the virus spreading rapidly again, which could lead to a closure of business activity. The Dow Jones Industrial Average futures fell to a three-week low of 24549, the S&P500 futures declined to 2934, and Nasdaq futures tumbled to 9381.


The dollar index, which measures the greenback against a basket of major currencies, added to prior gains rising to 97.39, supported by growing demand for safety. The rising coronavirus cases around the world over the past couple of days knocked investors' risk appetite and guided them towards safer currencies. Mainly commodity currencies were the weakest against the dollar, where the USDCAD rose to 1.3685, the AUDUSD dropped to $0.6776, and NZDUSD plummeted to $0.6380.


Precious metal prices eased slightly as the dollar strengthened further. The price of a gold ounce fell to $1715, the price of a silver ounce tumbled to $17.05, and palladium futures held steady near $1920.


Oil prices tumbled on fears of having a second round of coronavirus outbreak, which could disrupt the global economic activity again and lead to lower oil demand. Beijing tightened its lockdown measures again after discovering new cases. Health officials are warning that the probabilities of having the virus spreading again are too high. The West Texas Intermediate crude July delivery plunged to $34.35, and Brent Blend August delivery fell to $37.23.

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