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FTSE 100 falls as Covid 19 cases rise and Trump-Biden election worries loom

Getty Images
Getty Images

The FTSE 100 was today expected to edge down as investors digested the first Presidential debate between Donald Trump and Joe Biden.

Ahead of the November US election, the pair clashed in a fiery debate on key areas including the coronavirus crisis and the economy. As Covid claimed a million lives globally, debate rages over Trump’s handling of the outbreak.

For investors, the outcome of the debate was far from definitive, which was reflected in mixed Asian market trading.

The Hang Seng in Hong was up 1.3%, while the Shanghai Composite index was also up, but stock markets in Japan and Thailand fell. South Korean markets were closed today.

A factor in the pick up in some markets was likely positive signals for the recovery of the Chinese economy. The country, the source of the Covid outbreak, posted a slight slip in its Caixin manufacturing PMI index – to 53.0 from 53.1 – but a score over 50 still indicates growth. And the country’s official PMI figure increased to 51.5 from 51.0, its highest level in two years.

“The economic recovery has picked up pace with supply and both domestic as well as overseas demand improving,” Stephen Innes of AxiCorp said in a commentary.

After a positive start to the week on Wall Street, big consumer stocks which rely on Americans spending fell back, as well as banking and energy shares.

In Europe, the FTSE 100 was forecast to nudge down 23 points to 5848, following a 30 point drop yesterday.

Sterling will be in focus with revised UK GDP figures for the second quarter due, and post-Brexit trade deal negotiations in play. The mood music around the UK’s talks with Brussels has improved slightly this week, which could lift sterling.

On a brisk day for UK corporate trading, Boohoo was likely to be the focus for investors in retail stocks. The company is due to post interim results which should show the extent to which the boom in online retail during lockdown helped sales.

But the update has been overshadowed by last week’s damning report into allegations of modern slavery at the firm which found bosses knew of the poor treatment of factory workers at its suppliers in Leicester in December last year at the very latest but failed to stem the problems. The affair has sparked called for the brand’s founder-chairman Mahmud Kamani to quit.