FTSE stocks were on a steep decline on Monday as the UK’s top government scientists said the country has 6,000 new cases a day, doubling every seven days. If the virus continues to spread at this rate, that would lead to 200-plus deaths per day by November.
The UK government’s chief scientific adviser Patrick Vallance and England’s chief medical officer Chris Whitty gave a joint press conference live on television on Monday.
READ MORE: England’s chief medical officer fuels fears of second lockdown for UK economy
Mayor Sadiq Khan has also publicly called for more aggressive action following surging infection rates.
Britain’s FTSE 100 (^FTSE) has fallen to 3.4% on Monday at around 11:30am.
European indices have been on the decline since early trading. Germany’s DAX (^GDAXI) is down 2.4%, and France’s CAC 40 (^FCHI) has dropped by 2.4 since around 10:30am on Monday.
“As we look to a new week, with investors absorbing the recent statements from central banks, and the prospect that further stimulus may not come immediately, concerns are rising that the summer recovery is probably as good as it gets when it comes to the recent rebound in economic activity,” said Michael Hewson, chief market analyst at CMC Markets UK.
Watch: City workers react to a possible London lockdown
The Bank of England announced its major monetary policies would go unchanged on Thursday, keeping interest rates at record low levels and maintaining the Bank’s programme of bond buying at £745bn ($966.6bn).
The US Federal Reserve also had held interest rates near zero and signalled they were likely to stay that way until at least 2023 on Wednesday.
Tomorrow we will hear from Bank of England governor Andrew Bailey, who will be speaking to the British Chamber of Commerce.
He will hopefully offer some guidance on how serious the central bank is about the prospect of negative rates, and the conditions that are necessary for the monetary policy committee (MPC) to apply them.
READ MORE: FinCEN report: HSBC shares drop to lowest level since 1995
Also this week, flash PMIs on Wednesday will draw attention as they offer the first glimpses of September economic performance around the world.
That’s as economic and social restrictions continue mounting in the face of COVID-19, but it could be too early to see the full toll the virus is having on economies.
Germany’s Ifo survey is also out on Thursday. It has been gaining each month since its April low, even as it remains below its pre-pandemic level.
The news cycle picked up this weekend after US Supreme Court Justice Ruth Bader Ginsburg passed away late Friday night following a long battle with cancer.
President Donald Trump has already said he would put forward a nominee to fill the seat. If he succeeds at getting his nomination through before the election then there will be a 6-3 Republican bias to the Supreme Court. This could have serious policy consequences on issues relating to healthcare, abortion rights and gun law.
Watch: Trump likely to name woman to succeed Ginsburg
US futures are pointing to a lower open. S&P 500 futures (ES=F) were down 0.6%, Dow Jones futures (YM=F) were 0.6% lower, and Nasdaq futures (NQ=F) were off by 0.5%.
Asian stocks were mixed overnight. Japan’s Nikkei (^N225) rose 0.2%, Hong Kong’s Hang Seng (^HSI) fell 1.6%, dragged down by HSBC and Standard Chartered shares hitting record lows following media reports that some of the world’s largest banks had moved large sums of allegedly illicit funds over nearly two decades. China’s Shanghai Composite (000001.SS) slid 0.7%. The KOSPI (^KOSPI) in South Korea is also down 0.8%.
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