Global stocks mixed as Lagarde warns of continued Covid-19 drag | Inquirer Business

Global stocks mixed as Lagarde warns of continued Covid-19 drag

/ 06:50 AM January 22, 2021

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A pedestrian walks past an electronic quotation board displaying Japanese companies’ stock prices on the Tokyo Stock Exchange in Tokyo on January 21, 2021. (Photo by Behrouz MEHRI / AFP)

NEW YORK – Global stocks were mixed Thursday, with the Nasdaq pushing to a fresh record on lingering optimism over the US presidential transition while European Central Bank Chief Christine Lagarde warned of continued challenges from Covid-19.

Thursday’s Wall Street session was choppy after all three major indices surged to records on Wednesday in anticipation of an improving economic picture thanks to newly-installed US President Joe Biden’s stimulus plan and efforts to bolster the Covid-19 vaccine rollout.


The Nasdaq finished at a second straight record behind strength in Apple, Facebook and other tech shares.


But petroleum-linked shares plummeted following a series of Biden announcements, including moves to cancel the permit for the Keystone XL pipeline, freeze a plan to allow drilling in the Arctic National Wildlife Refuge and rejoin the Paris climate accord.

But early news reports indicating congressional skepticism of Biden’s $1.9 trillion fiscal package suggest “it isn’t going to be an easy undertaking to get the fullness of the proposal passed soon,” said analyst Patrick O’Hare.

European indices fell after the European Central Bank held back from tweaking its ultra-loose monetary policy, while Lagarde warned the pandemic still poses “serious risks” to the eurozone economy.

The latest virus setbacks “are disrupting economic activity,” Lagarde said, noting that the services sector was hit especially hard.

“The intensification of pandemic poses some downside risks to the short-term economic outlook,” she added.

The euro fell in value against the pound, with the British currency buoyed by the UK’s early vaccine rollout, analysts said.


The stronger pound, which briefly hit a 2.5-year high versus the dollar, weighed on London’s benchmark FTSE 100 index, especially on multinationals that record substantial earnings in the US currency.

Europe’s single currency also gained ground against the dollar, and Lagarde emphasised during a press briefing: “We are monitoring very carefully exchange rates.”

A stronger euro makes imports cheaper, keeping a lid on consumer prices and inflation, while exports become less competitive, hurting growth prospects.

Earlier in the day, Asian stock markets posted solid gains as Biden prepared to unveil plans on tackling the coronavirus crisis.

The Bank of Japan revised its growth outlook upwards for the next two years, and maintained its ultra-loose monetary policy, while noting it was hard to establish clear forecasts due to the pandemic.

Key figures around 2150 GMT

New York – Dow: DOWN less than 0.1 percent at 31,176.01 (close)

New York – S&P 500: UP less than 0.1 percent at 3,853.07 (close)

New York – Nasdaq: UP 0.6 percent at 13,530.91 (close)

London – FTSE 100: DOWN 0.4 percent at 6,715.42 (close)

Frankfurt – DAX 30: DOWN 0.1 percent at 13,906.67 (close)

Paris – CAC 40: DOWN 0.7 percent at 5,590.79 (close)

EURO STOXX 50: DOWN 0.2 percent at 3,618.35 (close)

Tokyo – Nikkei 225: UP 0.8 percent at 28,756.86 (close)

Hong Kong – Hang Seng: DOWN 0.1 percent at 29,927.76 (close)

Shanghai – Composite: UP 1.1 percent at 3,621.26 (close)

Euro/dollar: UP at $1.2169 from $1.2106 at 2200 GMT

Dollar/yen: DOWN at 103.50 yen from 103.54

Pound/dollar: UP at $1.3735 from $1.3654

Euro/pound: DOWN at 88.59 pence from 88.66 pence

West Texas Intermediate: DOWN 0.3 percent at $53.31 per barrel

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Brent North Sea crude: UP less than 0.1 percent at $56.10 per barrel

TAGS: Biden, Business, global stocks, NASDAQ, Stock Market, US

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