* European stocks choppy, e-mini S&P 500 futures rise 1%
* Oil falls again, dollar grinds higher
* Volatility gauges elevated as U.S. election looms
* ECB meeting expected to signal support coming
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
By Marc Jones
LONDON, Oct 29 (Reuters) - European stocks and commodity
markets struggled to stabilise on Thursday, after a return to
national lockdowns in some of the region's biggest economies
triggered the most brutal global selloff in months.
Hopes that the European Central Bank will signal later it
has more support to offer and a 0.5-1% bounce in Wall Street
futures stemmed the rout that had wiped nearly 5% off European
stocks on Wednesday, but they were still shaky.
The pan-European STOXX 600 was up only 0.1% .STOXX and
though Frankfurt's DAX .GDAX was up 0.5%, it was firmly on
course for an 8% weekly drop which will be the steepest since
the initial COVID panic of March. .EU
Concerns hit commodities too, with oil taking another 1.8%
spill to leave it at its lowest since June at $38.5 a barrel.
O/R
"What I think has changed in the last few days is the
significant spikes in the virus in Europe and the U.S,
especially the U.S." said Kempen Capital Management's Chief
Investment Officer Nikesh Patel.
As a result, "the W-shaped scenario for the economy has now
become consensus in the market" rather than one where economies
broadly stabilise.
Economic data and the ECB meeting were the day's other main
focus, with gathering uncertainty about Tuesday's U.S. election
also keeping investors on edge.
The Bank of Japan had made no changes to monetary policy
settings as expected overnight, though it trimmed its growth
forecasts to reflect sluggish services spending during summer.
Investors expect the ECB to similarly hold off on new
measures, but to instead hint at action in December, which is
likely to keep a lid on the euro. The common currency EUR= hit a 10-day low on the dollar
and a hundred-day low on the yen EURJPY= on Wednesday, before
recovering slightly. It last bought $1.1752.
German government bonds, seen as Europe's principal
safe-haven assets, were still in strong demand, with their
yields, which move inversely to price, near seven-month lows.
Benchmark U.S. 10-year yields US10YT=RR had ticked up
overnight to 0.7877%.
"Given what is happening in France and Germany I think the
ECB will talk about more stimulus even if they don't deliver it
today," added Kempen's Patel, referring to new COVID-19
restrictions announced this week.
RED OCTOBER RUMBLES ON
Global stock markets lost nearly $2 trillion yesterday, with
volumes on the New York Stock Exchange up almost 40% to their
highest level since September.
Overnight, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS fell 0.6%, led by Australia,
.AXJO down 1.6%, and South Korea .KS11 , down 1%.
Japan's Nikkei .N225 fell just 0.3%, while Chinese blue
chips .CSI300 rose 0.5% and the yuan led a gentle bounce in
Asian currencies against the greenback. FRX/
"Asia is not really partaking in this second or third wave
story because it's got its COVID largely under control," said
Rob Carnell, chief economist in Asia at Dutch bank ING.
"As a result, domestic economies look reasonable."
As if to illustrate, Taiwan, which boasts Asia's
best-performing currency, marked its 200th straight day without
local transmission on Thursday, while France and Germany
prepared for lockdowns and as the virus sweeps across the U.S.
Midwest.
Investors are also increasingly wary of a contested U.S.
election result that could unleash a wave of risk-asset selling.
Wall Street's 'fear gauge', the Cboe Volatility Index .VIX
surged on Wednesday to its highest level since June and implied
currency volatility indicates that a wild ride is expected.
In the currency markets, the U.S. dollar edged up slightly
and riskier currencies remained subdued.
The dollar, which hit a nine-day high in the previous
session, was up 0.1% against a basket of six currencies =USD
while the euro near a three-month low. Japan's yen was broadly
steady after the Bank of Japan's subdued message on the economy.
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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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