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Stock markets struggled yesterday as a week-long rally sputtered, with sentiment split between vaccine hopes and Joe Biden’s US election win on the one side and fears of a coronavirus surge that threatens economic recovery on the other.

“The near-certainty of a horrible few months ahead for the United States (and Europe) given current infection, hospitalisation and death rates, is dominating sentiment just at the moment,” said National Australia Bank’s Ray Attrill.

In midday deals, London’s benchmark FTSE 100 index was down 0,3 percent, hit also by official data showing the UK economy slowing once more after exiting a record recession.

The British pound was also down, after sizeable gains in recent days on hopes of a post-Brexit trade deal between the UK and European Union. The dollar retreated versus the euro and yen but rose against sterling.

Oil prices steadied after strong recent gains.

The main stocks indices in Hong Kong, Shanghai, Sydney and Singapore all closed lower Thursday.

Tokyo though ended with gains and Wellington was marginally up.

Wall Street’s Dow index ended slightly in the red Wednesday, while the Nasdaq rallied two percent as tech firms were boosted by the prospect of more stay-at-home orders.

‘Winter of despair’

The mood across trading floors has been positive for much of the week after the former vice president toppled Donald Trump.

US pharma giant Pfizer meanwhile said its vaccine candidate was 90 percent effective in trials, while rivals have also posted positive updates on their tests.

Hopes that a treatment for the killer disease will be rolled out before 2021 put a rocket under stocks such as airlines that have been battered for most of the year.

Analysts said massive central bank and government stimulus will help to maintain a level of positive market sentiment.

“Once we have made it through what is still bound to be a winter of despair for health care concerns, it could trigger the mother of all economic rebounds boosted by unprecedented policy support,” said Axi strategist Stephen Innes.

Investors are keeping tabs on developments in Washington as Trump refuses to concede last week’s election, while launching legal challenges after claiming without evidence that there was massive voting fraud. — Wires.