Global stock prices toppled lower on Thursday, November as concerns about the U.S. presidential election continued to weigh on investor sentiment.
Longer-dated U.S. Treasury prices slipped after the Bank of England indicated that inflation is likely to rise further, and oil prices remained weak on skepticism about OPEC’s planned production limit.
MSCI’s 47-country “All World” index .MIWD00000PUS dropped 0.37 percent, dragged down by weakness on Wall Street.
The S&P 500 .SPX fell for an eighth straight session, its longest losing streak since the 2008 financial crisis, as Facebook shares weighed and investors grappled with uncertainty over next week’s U.S. election.
Facebook (FB.O) shares fell as much as 6 percent, a day after the social media giant warned that revenue growth would slow this quarter.
“The polls have tightened and now the concern is more about what might a Trump presidency look like and the market hasn’t quite priced that in,” said Ernie Cecilia, chief investment officer of Bryn Mawr Trust in Bryn Mawr, Pennsylvania.
“Given the fact that the election is five days away, that’s what’s driving near-term behavior right now.”
Investors have been unnerved in recent days by signs that the U.S. presidential race between Democrat Hillary Clinton and Republican Donald Trump was tightening just days before Tuesday’s vote.
The CBOE Volatility Index .VIX, a gauge of near-term investor anxiety, rose 14 percent to its highest level since late June.
The Dow Jones industrial average .DJI fell 28.97 points, or 0.16 percent, to close at 17,930.67, the S&P 500 .SPX lost 9.28 points, or 0.44 percent, to finish at 2,088.66 and the Nasdaq Composite .IXIC dropped 47.16 points, or 0.92 percent, to end at 5,058.41.
The pan-European STOXX 600 ended flat, giving up early gains as a strengthened pound weighed on the shares of internationally exposed companies, including Diageo (DGE.L).
Sterling surged to a four-week high after the UK court ruling soothed concerns about Brexit and the Bank of England scrapped plans to cut interest rates. It climbed as much as 1.5 percent to hit $1.2494 GBP=D4, its strongest since Oct. 7.
Meanwhile, the U.S. dollar hovered near multi-week lows against a basket of major currencies, ending a morning reprieve in which the greenback stabilized, on uncertainty surrounding the outcome of the U.S. presidential election. The dollar index .DXY was down 0.25 percent to 97.156.
“We’re now seeing markets price in a higher risk of a Trump presidency,” said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington. “Most polls are still showing that it’s far too close to call, and that’s ultimately what is keeping investors nervous.”
In bond markets, longer-dated U.S. Treasury prices fell after the Bank of England indicated that inflation is likely to rise further, while uncertainty over the U.S. election propped up shorter-dated debt.
The BoE ramped up its forecasts for growth and predicted that inflation would jump to 2.7 percent this time next year, nearly triple its current level.
