The US stock exchanges ended on a negative note on Monday. The mood of market participants seriously fell after the news about the lack of progress in the adoption of a new package of financial incentives in the country.
The negotiations remain unsettled despite all the persuasions from the representatives of the Congress to resolve the urgent issue as soon as possible. Regular meetings were scheduled for Monday, but they did not take place.
Moreover, it is becoming increasingly common to think that it will not be possible to reach a consensus before the presidential elections in the US. This, of course, seriously puts pressure on the main stock indexes, which are beginning to decline rapidly. And sometimes the drop during the day reaches the minimum levels. Thus, the issue of stimulus measures is still very influential for the securities market, which reacts sharply to the slightest changes in this direction.
Recall that the Republicans and Democrats have been unable to make a decision on the stimulus for several weeks in a row. This is due to the deep disagreements between the parties over the amount of funds needed to support the economy. The scale of the bill has not yet been determined, which only complicates the entire negotiation process.
However, there are still some hopes that the deal will be signed. At least, both sides express a great desire to finally close this painful topic.
Another issue that bugs stock markets is the significant and unceasing increase in the cases of coronavirus infection. According to Johns Hopkins University, the number of new COVID-19 patients had increased by 5% by Friday last week. Of particular concern is the fact that the increase in infection is already occurring in more than 38 states. The second wave of the pandemic has become inevitable and now measures to contain this virus has become extensive. This is precisely what causes fears among investors who are not ready for new strict restrictive quarantine measures.
In total, about 40 million cases of coronavirus infection were detected worldwide as of Monday. At the same time, about 30 million patients successfully coped with COVID-19.
The Dow Jones Industrial Average closed in the red on Monday which declined 1.44%, or 410.89 points, which moved it to its current level of 28 195.42 points.
The S&P 500 index fell 1.63% or 56.89 points, which sent it to 3,426.92 points.
The NASDAQ Composite Index parted from 1.65% or 192.67 points, which moved it to 11,478.88 points.
Meanwhile, losses were noted on the major stock indexes in the Asian stock exchanges Tuesday morning, which is caused by a negative trend in the US markets. This, in turn, is related to the unresolved problem of financial incentives.
In addition, investors are waiting for confirmation that China's economy is rapidly recovering from the effects of the coronavirus pandemic. That is why their views are closely focused on the Chinese statistics because the positive dynamics in this direction will be reflected in the rest of the region.
China's GDP from July to September of this year went up by 4.9% compared to the same period last year. However, initial estimates were still slightly higher with an expected growth of 5.2%.
Japan's Nikkei 225 Index fell 0.5%.
China's Shanghai Composite index did not support the negative trend, however, rose insignificantly by 0.05%. The Hong Kong Hang Seng Index parted from 0.2%.
It became known that the People's Bank of China has not made any changes to the basic interest rate on loans. Thus, for six months everything remains the same. And this is further proof that the country's economy is in the process of recovery, which is proceeding quite rapidly.
South Korea's KOSPI index lost 0.1%.
Australia's S & P / ASX 200 Index dropped 0.7%.