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Trumps COVID Diagnosis Hits Markets as Stock Futures and Oil Dip, Safe Havens Rise

President Donald Trumps positive COVID-19 diagnosis was felt across global markets, triggering a relatively modest sell-off in U.S. stock futures, a sharper drop in oil and global equities, and driving interest in safe havens like U.S. Treasuries and gold.

“Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately,” Trump wrote in a message on social media shortly before 1 a.m. ET Friday. “We will get through this TOGETHER!”

U.S. stock futures for the benchmark S&P 500 initially fell 1.7 percent, before ticking back up, trading down around 1.3 percent at the time of reporting. Nasdaq futures fell to around 2.2 percent.

Safe haven gold, meanwhile, saw a modest spike of around 0.5 percent before settling at 0.14 percent at the time of reporting, while the 10-year US Treasury was down 3.1 percent. The yield of government securities, considered a safe harbor in times of uncertainty, falls as prices rise along with greater investor interest.

Both U.S. and Brent crude fell by over 3 percent.

Stocks in Asia Pacific also ticked down on the news, with Japans Nikkei 225 finishing down nearly 0.7 percent, and Australias S&P/ASX 200 stock index dropping nearly 1.4 percent.

European stocks were lower in morning trading, with the FTSE 100 down around 0.7 percent in London, Frances CAC 40 trading down nearly 0.9 percent, while and Germanys DAX fell 1.1 percent.

The news prompted investors to prepare for a period of heightened volatility, with analysts expecting that markets will remain on edge for the foreseeable future.

Frankfurt analyst Robert Halver of Baader bank saw no reason for concern, however, and said he saw no danger for “a lot of damage on the stock exchange.” He expects that, by next week, markets will be back to normal.

“If there are political problems in the world an immediate reflex always is to look for save havens: there is a demand for gold and were seeing that today. Shares are sold, government securities are bought,” Halver said adding, “Its tRead More – Source

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