Stocks Prolong Rally; Dollar Weakens to March Low: Markets Wrap

 

 

 

These are the main moves in markets:

Stocks

• Futures on the S&P 500 Index increased 1,02% as of 9:15 a.m. New York time.
• Nasdaq 100 Index futures rose 0.3%.
• The Stoxx Europe 600 Index gained 1.3%.
• The MSCI All-Country World Index climbed 0.5%.

Currencies

• The Bloomberg Dollar Spot Index sank 0.3%.
• The euro gained 0.3% to $1.1198.
• The British pound increased 0.2% to $1.2575.
• The Japanese yen strengthened 0.1% to 108.59 per dollar.
• The Indian rupee weakened 0.2% to 75.475 per dollar.

Bonds

• The yield on 10-year Treasuries rose two basis points to 0.71%.
• Germany’s 10-year yield climbed three basis points to -0.39%.
• Britain’s 10-year yield increased three basis points to 0.25%.
• Australia’s 10-year yield gained six basis points to 0.9765%.

Commodities

• Brent crude dipped 0.9% to $39.21 a barrel.
• Gold weakened 0.5% to $1,719.76 an ounce.
• Soybeans climbed 0.5% to $8.55 a bushel.

The global stocks rally held its momentum Wednesday as investors clung to optimism for a quick economic recovery from the pandemic despite violent protests in U.S. cities. Treasuries dipped with gold, while a dollar gauge hit its lowest level since early March.

Futures rose on both the S&P 500 Index and the Nasdaq 100, which closed on Tuesday within 1% of its record high. Micron Technology and Apple Inc. climbed in the premarket. The dollar held its drop against major peers as data on U.S. private payrolls showed fewer job losses than analysts’ forecasts in May.

European stocks advanced, led by auto and insurance companies. The euro gained for a seventh session as data showed the region’s economic activity increased in May to the highest in three months after an easing of lockdown restrictions. Brent crude failed to sustain a rally above $40 after Bloomberg reported that a meeting between OPEC and its allies is unlikely to happen this week over issues of cheating.

“If I look at the markets, I see a V-shaped recovery,” Mark Mobius, co-founder at Mobius Capital Partners, said on Bloomberg TV. “What we’re hearing from companies around the world is that once the lockdown is over, they’re going to get the customers coming back in droves.”

Stocks have advanced globally for eight days to their highest level versus estimated earnings since the early 2000s, as more businesses reopen around the world and manufacturing gauges show economies stabilizing following shutdowns. That’s despite a slew of risks, including tense U.S.-China relations that may jeopardize a hard-won trade deal, as well as violent clashes and looting in American cities.

The optimism contrasts with caution prevalent in mid-May among many of the biggest names in finance, including legendary investors Stan Druckenmiller and David Tepper, that equities looked overvalued or that a V-shaped economic recovery was fantasy.

Elsewhere, shares in South Korea led Asia equities higher after the country detailed a third round of fiscal stimulus, while Singapore’s benchmark entered a bull market. MSCI’s gauge of emerging-market stocks climbed close a three-month high.