Por Geoffrey Smith
Investing.com – Stocks plummet as coronavirus surge threatens new blockages, Microsoft (NASDAQ :); (SA 🙂 earned $ 1 billion a week in the third quarter, Turkey is heading for a monetary crisis and oil is falling due to high US stocks. Here’s what you need to know about the financial markets on Wednesday, October 28th.
1. Virus causes global liquidation
Global stock markets have fallen dramatically as several countries have again restricted social gatherings in an attempt to break the trend of increasing coronavirus infections.
Several reports in Germany have suggested that Chancellor Angela Merkel will try to close bars and restaurants throughout November at a meeting with state governors in Berlin on Wednesday.
The news comes just two weeks after the government’s board of economic experts revised down its growth forecasts for the next two years.
The index led European stocks in the fall, falling nearly 3% to a four-month low. Yield on 10-year German government bonds fell four basis points to -0.64%, the lowest since March. The index fell 1.8% to a five-month low.
2. Microsoft results powered by cloud and games
Microsoft $ 1 billion every week for the three months through September, taking advantage of a sustained wave of demand for cloud hosting, computers and video games.
Revenue increased 12%, thanks in large part to a 48% gain on Azure, the company’s cloud hosting service, whose growth was accelerated by the trend towards remote work and restrictions on socialization in real life. The game content business, which revolves around the Xbox product, was not far behind, with a 30% gain.
The Redmond-based giant was the first of the so-called “Gigacaps” to report third-quarter earnings after closing on Tuesday. Threateningly, perhaps, the stock fell 1.5% on the floor after closing, after failing to live up to expectations with its revenue forecast for the current quarter.
3. Shares are expected to open sharply
US stocks are set to open sharply, with concerns about the spread of the virus in no way confined to Europe. The United States registered another 74,000 new cases of Covid-19 on Tuesday, while hospital admissions increased 50% from the previous month, to more than 44,000, according to data from Covidtracking.com.
Some of the biggest outbreaks of infections occur in the midwest, in states of electoral battle such as Michigan, Wisconsin and Ohio, which have been largely spared the first two waves of the pandemic. Johns Hopkins University estimates that about 227,000 Americans have died of the virus, more than in any other country in the world.
At 9:12 am (Brasília time), futures fell by 475 points, or 1.7%, futures fell by 1.5%, while futures fell by 1.3%.
Futures, in turn, which follow the level of market volatility, rose 5.7% to a three-week high.
On balance sheets, Boeing (NYSE :); (SA 🙂 and the General Electric (NYSE :); (SA 🙂 lead a large list of companies that will report today, while Visa (NYSE :); Visa (SA 🙂 and Mastercard (NYSE :); (SA 🙂 lead the disclosures after closing.
4. Turkey spiraling into the monetary crisis
Turkey’s fell to a new record low against the dollar for the fifth consecutive day, with investors losing faith in the central bank’s ability to sustain it against the dollar, which is now rising again due to safe harbor flows foreign exchange markets. At 9:16 am (Brasília time), the dollar was at 8.2804, up 1.2% on the day and more than 20% against the value of the central bank in August.
The currency has been in free fall since the central bank chose not to raise interest rates at its meeting last week, and on Wednesday the bank raised its inflation forecast for the year from 8.9% to 12, 1%.
It did not help that President Recep Tayyip Erdogan appears to have the intention of antagonizing all of Turkey’s most important international partners with his foreign policy in recent weeks: his government has upset the US by promoting the purchase of sophisticated Russian missile defense systems and is supporting Azerbaijan War with Armenia, supported by Russia, by the Nagorno-Karabakh enclave. Erdogan also increased tension with the EU in a dispute over oil and gas reserves in the eastern Mediterranean.
5. Oil falls due to fears of demand and increased inventories; Zeta grows up
Oil prices fell to a three-week low in line with other risky assets, as the increase in coronavirus cases in the northern hemisphere fueled fears of further destruction of demand.
At 9:12 am, futures fell 4.7% to $ 37.72 a barrel, while the international benchmark fell 3.8% to $ 40.02 a barrel.
The sentiment soured after the American Petroleum Institute reported the biggest weekly increase in the US in more than three months on Tuesday, at almost 4.6 million barrels. Government officials are expected at 11:30 am, as usual.
Hurricane Zeta is expected to hit the mainland on Wednesday as a Category 2 storm, with the Alabama-Mississippi border likely to have the worst storm waves.