REUTERS/Dado Ruvic
- Asian stocks rose on Tuesday after Moderna reported promising results from the first human trials of its coronavirus vaccine.
- US futures slid after US President Donald Trump threatened to terminate funding to the World Health Organization unless it makes “substantive improvements” following its response to the coronavirus outbreak.
- The UK’s unemployment claims rose to a record high in April.
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Asian indexes extended gains on Tuesday after Moderna showed signs of success in the first human trials of its coronavirus vaccine.
The biotech firm reported on Monday that the vaccine produced protective antibodies in all eight of its volunteers, potentially marking a breakthrough moment in the fight against the coronavirus pandemic.
However, analysts recommended investors consider “some of the small print.”
“All companies searching for a vaccine like to say they are doing well: it’s very much in their interest. This was a sample of less than 10 when phase two, starting in months, will be on many thousands,” analysts at Rabobank said in a note.
“Even if that hurdle is passed with flying colors we will still not see a vaccine on the US market, let alone in emerging markets, until early 2021.”
Here’s the market roundup as of 11.15 a.m. in London (11:15 a.m. ET):
- Asian indexes climbed with China’s Shanghai Composite up 0.8%, Hong Kong’s Hang Seng up 1.9%, and Japan’s Nikkei up 1.5%.
- European equities fell, with Germany’s DAX down 0.8%, Britain’s FTSE 100 down 0.7%, and the Euro Stoxx 50 down 0.9%.
- US stocks are set to open lower. Futures underlying the Dow Jones Industrial Average, the S&P 500, and the Nasdaq fell by 0.3% to 0.5%.
- Oil prices fell, with West Texas Intermediate down 0.3% at $31.60, and Brent crude down 0.4% at $34.70.
- The benchmark 10-year Treasury yield fell to 0.71%.
- Gold rose 0.2% to $1,738.
The decline in US futures may have been sparked by President Trump threatening to cut funding the World Health Organization due to its “failed response to the Covid-19 outbreak.” His administration will review the matter over the next 30 days.
In a letter to the WHO chief, Dr. Tedros Adhanom Ghebreyesus, Trump wrote the organization must make “major substantive improvements,” failing which the US would permanently end funding and reevaluate membership.
Elsewhere, the UK reported horrific jobs data similar to the US. The country’s statistics authority announced unemployment claims soared to 2.1 million in April, a record monthly increase.
“The claimant count change for last month rose by 856,500 – to put that in perspective, March’s increase was 5,400, while analysts were forecasting an increase of 675,000,” Connor Campbell, a financial analyst at SpreadEx, said in a note.
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