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Stocks fall as Trump tests positive for COVID-19

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·2-min read

Watch: Trump's COVID diagnosis rattles global markets

Stocks fell around the world on Friday, reacting to news that US president Donald Trump and first lady Melania Trump had both tested positive for COVID-19.

The president announced in a tweet that he and his wife had tested positive for the virus, hours after first confirming they were getting a test.

“Tonight, @FLOTUS and I tested positive for COVID-19. We will begin our quarantine and recovery process immediately. We will get through this TOGETHER!,” Trump tweeted.

Melania Trump tweeted that the pair were “feeling good & I have postponed all upcoming engagements.”

The pair were tested after Hope Hicks, a close adviser to the president, contracted COVID-19.

News that the pandemic had reached the heart of the White House hit stocks around the world. Japan’s Nikkei (^N225) reversed earlier gains to close down 0.7% and Australia’s ASX 200 (^AXJO) slumped to close down 1.4%. European stock markets opened lower and US stocks sold off at the open.

President Donald Trump speaks at a campaign rally at Duluth International Airport, Wednesday, Sept. 30, 2020, in Duluth, Minn. (AP Photo/Alex Brandon)
President Donald Trump speaks at a campaign rally at Duluth International Airport, Minnesota, US, on Wednesday. Photo:Alex Brandon/AP

“The biggest question for investors and traders is how this situation is going to impact Trump’s presidential campaign?” said Naeem Aslam, chief market analyst at Avatrade.

The White House released a signed letter from the president’s physician, Dr Sean Conley, saying he expects Trump to continue to carry out his duties while in quarantine.

Sebastian Galy, a senior macro-strategist at Nordae, said: “The probabilities of Joe Biden winning are increasing. Faced with this, the administration is likely to take a strong step early, likely against China. Hence, this shock should create a series of aftershocks and volatility is unsurprisingly expensive.”

Watch: Donald Trump talks about getting tested for COVID-19

In Europe, the FTSE 100 (^FTSE) fell 1.1% at the open, the German DAX (^GDAXI) dropped 1.4%, and the French CAC 40 (^FCHI) fell 1.3%.

Fears eased as the session wore on. The FTSE 100 ended the day up 0.2%, while the DAX was down 0.4% and the CAC 40 was off just 0.1%.

The S&P 500 (^GSPC) dropped 1% as trade got under way in New York, while the Dow Jones (^DJI) shed 0.7% and the Nasdaq (^IXIC) fell 1.4%. All three indices were still solidly in the red by the time trade ended in Europe, although here too losses had eased.

Overnight in China, the Shanghai Composite (000001.SS) closed down 0.2% and the Shenzen Component (399001.SZ) ended flat. Both saw sharp falls after the news of Trump’s COVID-19 diagnosis was made public. The Hong Kong Hang Seng (^HSI) rose 0.8%.