EUROPEAN STOCKS SINK, THEN RECOVER

European stocks recovered from early losses on Friday, following a bearish Asian session where investors adjusted their risk exposure before the US elections two weeks away. Record COVID-19 cases in Europe also weighed on sentiment, Reuters reported on October 20, 2020. 

MSCI world equity index, which tracks shares in 49 countries, slipped as much as 0.2%. By 0825 GMT (4:25 p.m. on October 20, 2020 in Manila), MSCI's main European Index was up 0.4% and Europe's STOXX 600 was up 0.2%, after initially falling as fears about the economic impact of lockdown restrictions outweighed some strong earnings. 

With just two weeks until the US presidential elections on Nov. 3, analysts said that investors were reining in their riskier bets. President Donald Trump and Democratic rival Joe Biden will debate each other in an event on Thursday which will feature a mute button to allow each candidate to speak uninterrupted. 

US fiscal stimulus talks are in focus, as House Speaker Nancy Pelosi set today as a self-imposed deadline for reaching a deal on a coronavirus aid package. Pelosi said over the weekend that differences remained but that she was optimistic legislation could be pushed through before the election. But markets doubted fiscal stimulus would be passed in the near term.