The lockdown fear is gripping stock markets around the world resulting collapse of share markets around the globe. The strict lockdown fear is rapidly growing as Coronavirus cases are increasing in Europe and the U.S. European Stock market STOXX crashed, losing 2.5% on reports of lockdowns in Germany and France. German share market dropping to 3.2% to their lowest since June. In Europe, automakers slumped to 4.2% while banks lost 3.9% of their value. The highest decline was in Paris index losing 3.5%.
Investors are afraid that the fragile economy can get another hit due to new restrictions and lockdown as cases have been increased in recent days in Russia, the United States and European countries.
The senior economist AlessiaBerardi at Amundi said that the second wave of Coronavirus is now clearly very strong in Europe.
Asian share also tumbles after showing some resilience. Japan Asia index lost 0.1% turning negative despite some recovery from China and South Korean stocks.
The Currency and bond market were also affected due to the second wave of Coronavirus and fear of another lockdown. Euro, EUR=EBS lost 0.4% against the dollar. The German government Bond hit the rock bottom since March. In U.S S&P500 lost 0.3% while Nasdaq gain 0.6%
The presidential election is adding more fuel to the uncertainty. Joe Biden is having a consistent lead over Trump and he is cautiously promoting investor to bet on his victory.But Wall street Volatility index showsanother side of the picture which rose to 36.60 to its highest since early September.
Deutsche Bank analysts said that it is still not clear who will win the elections. it will be possible to predict the winner by next Wednesday morning.
This uncertainty was clear in currency market too. Volatility index for the euro and yen is at highest in nearly seven months. Chinese yuan also hitting its highest volatility index since January 2016. The U.S. dollar increase by 0.1 per cent against a bunch of currencies.