Wall Street futures turned negative after starting higher, with E-minis for the S&P500 ESc1 off 0.3 percent. China, opening for the first time since Thursday, started on the backfoot with the blue-chip index down 0.6 percent. Australian shares skidded 0.8 percent. “There is a distinct risk-off tone to greet China coming back from holiday,” said Stephen Innes, chief global markets strategist at AxiCorp.
“With Trump and the company still on the Wuhan Lab rampage, traders are incredibly cautious this morning, weighing all the possible China responses. And the one that would hurt the most would be for China to reduce imports of US oil.”
Global financial markets have been caught this month between grim economic figures and worries about worsening US-China relations, and optimism over easing COVID-19 lockdowns in many countries.
US President Donald Trump has repeatedly taken aim at China as the source of the pandemic and warned that it would be held to account.
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FTSE 100 LIVE: Wall Street stocks went negative
Global financial markets have been caught this month between grim economic figures and worries about worsening US-China relations
12.38pm update: Bundesbank comments on ECB ruling
Bundesbank President Jens Weidmann said extraordinary measures enacted by the European Central Bank were necessary to support the euro zone economy, even if opinions differed on the details of the measures.
His comments come a day after the German Constitutional Court ruled that the ECB overstepped its powers when it bought €2 trillion were of government bonds since 2015.
12.22pm update: Boris urged not to return to days of austerity
Mr Johnson was pushed by Labour’s Mike Amesbury to not return to the “dark days of austerity” and instead help councils through the pandemic during this afternoon’s PMQs.
He replied in the Commons: “I can certainly tell him that the Government has absolutely no intention of returning to the A-word, which I won’t quote. That is not going to be our approach.”
“We will continue to make sure funding gets through to those who need it but the crucial thing… is that the more effectively we can suppress this virus and the faster we can restart our economy, the better our chances of getting the funding that we all need to the poorest and neediest in our society.”
11.03am update: Pound Sterling falls
The pound fell as much as 0.7 percent against the dollar on Wednesday morning before construction PMI data for April, which was worse than expected.
British construction suffered its sharpest decline on record, more than twice as large as the previous month, even though general construction work was not ordered by the government to stop as part of the lockdown intended to limit the spread of the coronavirus.
The pound did not move significantly when the data was announced at 0830 GMT. But between around 8.20am and 9.35am, cable fell 0.7 percent, hitting a 12-day low of $1.2359, a move which analysts said had no specific trigger.
Thu Lan Nguyen, senior FX strategist at Commerzbank, said like many currencies, the pound is mainly subject to changes in global risk appetite.
She said: “We had a phase in March particularly where more pound-specific factors were playing a role, but since April at least it’s moving more or less with global market sentiment.”
10.25am update: EU shares edge higher
European shares edged higher on Wednesday, riding on gains in the healthcare sector.
The pan-European STOXX 600 index rose 0.1 percent as healthcare stocks gained on the back of better-than-expected quarterly results from Denmark’s Novo Nordisk and German dialysis specialist Fresenius Medical Care.
Shares in UK-listed AstraZeneca jumped 1.5 percent after the US FDA approved its diabetes drug as a treatment for heart failure.
Cyclical sectors more exposed to global growth such as travel, oil and gas, and retailers fell between 0.5 percent and 1.1 percent limiting gains on the STOXX 600.
Wall Street futures turned negative after starting higher
9.01am update: FTSE up
The FTSE 100 index at 8.45am was up 1.85 at 5851.27.
8.30am update: FTSE 100 slides
The FTSE 100 fell 0.1 percent, with oil majors BP Plc and Royal Dutch Shell Plc tracking a slide in oil prices.
The domestically focussed midcap index dipped 0.2 percent.
8.10am update: Europe futures point to weak start
European futures pointed to a weak start after a court decision challenging German participation in Europe’s stimulus program fanning worries about a bumpy recovery.
Futures for the Eurostoxx 50 were flat while those for Germany’s DAX were off 0.1 percent.
8am update: FTSE opens
The FTSE 100 has opened at 5,849.42.
Economies across the world have been crippled by coronavirus
7.47am update: FTSE unchanged
The FTSE 100 index at 7.44am was unchanged at 5849.42.
7.40am update: ITV advertising revenue falls 42%
ITV, Britain’s biggest free-to-air commercial broadcaster, said COVID-19 had sent its advertising revenue down 42 percent last month, and an uncertain outlook meant it could not give guidance for the rest of the year.
The company, which paused the majority of its studio productions in mid-March and has furloughed around 800 workers, said it had identified another £30 million of savings in overheads on top of action it is already taking to cut budgets, including 100 million pounds from programming.
Chief Executive Carolyn McCall said ITV had taken swift and decisive action to manage and mitigate the impact of COVID-19, both on its people and its finances.
She said: “We are now very focused on emerging from this crisis in a strong position, continuing to offer advertisers effective marketing opportunities and making preparations to restart productions safely.”
Total external revenue for the three months to 31 March fell 7 percent to £694 million, as it was hit by working restrictions at ITV Studios caused by the crisis.
Broadcast revenue for the quarter rose 2 percent to £500 million, with ITV total advertising up 2percent as originally guided.
The biggest financial contributors to the WHO
7.35am update: FTSE 100 ‘to start lower’
The FTSE 100 is expected to open slightly lower – about 9 points lower according to spread-better IG.
7.22am update: Yen scales three-year high against euro
The yen scaled a three-year high against the euro and a seven-week peak on the dollar on Wednesday, after a court decision challenging German participation in Europe’s stimulus programme and worries about a bumpy global recovery spooked investors.
Germany’s highest court on Tuesday gave the European Central Bank three months to justify purchases under its bond-buying programme, or lose the Bundesbank as a participant in a scheme aimed at cushioning the economic blow from the coronavirus.
The news sent the euro to a one-week low of $1.0826, where it has stayed, and a three-year trough of 115.09 yen that it hit in the Asian session, as traders worried about both the scheme and euro zone turmoil.
The yen also edged up against the dollar, pushing through resistance to a seven-week high of 106.22, though volumes were light with Japanese markets shut for the final day of a national holiday.
7.08am update: Australia aims for ‘COVID-19 safe economy’
Prime Minister Scott Morrison said Australia will have a COVID-19 safe economy up and running by July, as his government seeks to get one million unemployed people working again.
It is not clear how many businesses this would see returning to full operations, though local media reported Australia has planned for a three-stage reopening.
Cafes, restaurants and retail are expected to be among the first to be allowed to reopen, with strict social distancing rules. Pubs, where social distancing is harder, would probably be amongst the last to fully reopen.
Australia has had less than 7,000 confirmed cases of coronavirus. Fewer than 1,000 people are still sick with COVID-19, though 96 people have died from the virus.
Australia is on Friday expected to announce a loosening of social distancing restrictions with curbs on most businesses removed by July.
Mr Morrison told Sydney’s 2GB Radio: “We need people back at work. We need the businesses open again.
“We can open up in what I’m calling a COVID Safe Australia.”
6.02am update: US airlines burn through $10 billion a month as traffic plummets
US airlines are collectively burning more than $10 billion in cash a month and averaging fewer than two dozen passengers per domestic flight because of the coronavirus pandemic, industry trade group Airlines for America said in prepared testimony seen by Reuters ahead of a US Senate hearing on Wednesday.
Even after grounding more than 3,000 aircraft, or nearly 50 percent of the active U.S. fleet, the group said its member carriers, which include the four largest US airlines, were averaging just 17 passengers per domestic flight and 29 passengers per international flight.
“The US airline industry will emerge from this crisis a mere shadow of what it was just three short months ago,” the group’s chief executive, Nicholas Calio, will say, according to his prepared testimony.
Net booked passengers have fallen by nearly 100 percent year-on-year, according to the testimony before the Senate Commerce Committee. The group warned that if air carriers were to refund all tickets, including those purchased as nonrefundable or those canceled by a passenger instead of the carrier, “this will result in negative cash balances that will lead to bankruptcy.”