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Dollar Extends Gain as Stimulus Measures Assessed: Markets Wrap
(Bloomberg) -- The dollar extended gains as investors questioned the effectiveness of a rapidly strengthening set of economic and financial support measures by global policy makers. Most stocks slid in volatile trading.U.S. stock futures initially advanced after the European Central Bank announced a huge boost in its efforts to stabilize the economy and capital markets. The move reversed as optimism faded, with investors increasingly concluding nothing can avert a global recession. The yen, so often a haven amid market stress, slumped, in a sign of the extraordinary demand for the greenback, which was near its strongest in more than three years. Asian stocks were mostly lower and European futures reversed losses. Treasury yields ticked higher while European yields declined. The euro fluctuated.The Reserve Bank of Australia cut its key interest rate to 0.25% and adopted Japan-style yield control among a raft of measures. Yields on the country’s 10-year bonds surged 128 basis points, the most on record, before paring gains. Even before the announcement, the Australian dollar was down about 4% amid the rush for U.S. currency, though the slide eased as the session wore on.South Korea’s won dropped 3%. Stocks in the Philippines slumped 24% after reopening markets following a controversial shutdown.The ECB unveiled a temporary program of asset purchases worth 750 billion euros ($820 billion) to fight the impact of the pandemic. The Fed said it was launching a program to support money-market mutual funds. U.S. shares earlier suffered another plunge as investor focus turned to assessing the length of the economic downturn. Oil rose to take back some of Wednesday’s 24% plunge that left prices at an 18-year low.“It’s a good start and a step in the right direction with the tools that they have available, but they can still do more,” Sue Trinh, global macro strategist at Manulife Asset Management in Hong Kong, told Bloomberg TV. “There’s much more need for U.S. dollar liquidity to get to where it’s needed the most,” she said. “At the moment the markets are screaming it’s not enough -- we need to see more of that.”The ECB package allows the central bank to buy private and public sector securities and broadens the eligibility to cover more assets. Meantime, the U.S. Senate cleared the second major bill responding to the coronavirus pandemic and White House economic adviser Larry Kudlow said the government might take equity equity positions as part of corporate rescues. Australia is expected on Thursday to announce a quantitative easing package.Policy makers around the world have moved in recent weeks to stem a calamitous shock to their economies, but investors have been repeatedly underwhelmed while the ensuing health crisis shows little sign of peaking any time soon.“The outlook has changed pretty dramatically even in the last few days,” Alicia Levine, chief strategist at BNY Mellon, told Bloomberg TV. “We’re looking at a sudden stop globally, so the probability of a global recession has gone up remarkably.”Here are the main moves in markets:StocksFutures on the S&P 500 Index were down 1.4% as of 7:16 a.m. London time. The underlying index fell 5.2% on Wednesday.Japan’s Topix index closed 1% higher.Hong Kong’s Hang Seng lost 2%.The Shanghai Composite dipped 1%.Australia’s S&P/ASX 200 Index fell 3.4%.South Korea’s Kospi index tumbled 8.4%.Euro Stoxx 50 futures rose 0.4%.CurrenciesThe yen was at 108.97 per dollar, down 0.8%.The offshore yuan fell 0.6% to 7.1154 per dollar.The pound was at $1.1546, down 0.5%.The Aussie bought 56.63 U.S. cents, down 2%.The euro traded at $1.0911, down 0.1%.BondsThe yield on 10-year Treasuries rose three basis points to 1.23%.Australia’s 10-year yield surged 28 basis points to 1.49%.CommoditiesWest Texas Intermediate crude added 9% to $22.22 a barrel.Gold was down 0.1% at $1,484 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
https://finance.yahoo.com/news/turmoil-rocks-assets-dollar-stocks-213530125.html?.tsrc=rss
(Bloomberg) -- The dollar extended gains as investors questioned the effectiveness of a rapidly strengthening set of economic and financial support measures by global policy makers. Most stocks slid in volatile trading.U.S. stock futures initially advanced after the European Central Bank announced a huge boost in its efforts to stabilize the economy and capital markets. The move reversed as optimism faded, with investors increasingly concluding nothing can avert a global recession. The yen, so often a haven amid market stress, slumped, in a sign of the extraordinary demand for the greenback, which was near its strongest in more than three years. Asian stocks were mostly lower and European futures reversed losses. Treasury yields ticked higher while European yields declined. The euro fluctuated.The Reserve Bank of Australia cut its key interest rate to 0.25% and adopted Japan-style yield control among a raft of measures. Yields on the country’s 10-year bonds surged 128 basis points, the most on record, before paring gains. Even before the announcement, the Australian dollar was down about 4% amid the rush for U.S. currency, though the slide eased as the session wore on.South Korea’s won dropped 3%. Stocks in the Philippines slumped 24% after reopening markets following a controversial shutdown.The ECB unveiled a temporary program of asset purchases worth 750 billion euros ($820 billion) to fight the impact of the pandemic. The Fed said it was launching a program to support money-market mutual funds. U.S. shares earlier suffered another plunge as investor focus turned to assessing the length of the economic downturn. Oil rose to take back some of Wednesday’s 24% plunge that left prices at an 18-year low.“It’s a good start and a step in the right direction with the tools that they have available, but they can still do more,” Sue Trinh, global macro strategist at Manulife Asset Management in Hong Kong, told Bloomberg TV. “There’s much more need for U.S. dollar liquidity to get to where it’s needed the most,” she said. “At the moment the markets are screaming it’s not enough -- we need to see more of that.”The ECB package allows the central bank to buy private and public sector securities and broadens the eligibility to cover more assets. Meantime, the U.S. Senate cleared the second major bill responding to the coronavirus pandemic and White House economic adviser Larry Kudlow said the government might take equity equity positions as part of corporate rescues. Australia is expected on Thursday to announce a quantitative easing package.Policy makers around the world have moved in recent weeks to stem a calamitous shock to their economies, but investors have been repeatedly underwhelmed while the ensuing health crisis shows little sign of peaking any time soon.“The outlook has changed pretty dramatically even in the last few days,” Alicia Levine, chief strategist at BNY Mellon, told Bloomberg TV. “We’re looking at a sudden stop globally, so the probability of a global recession has gone up remarkably.”Here are the main moves in markets:StocksFutures on the S&P 500 Index were down 1.4% as of 7:16 a.m. London time. The underlying index fell 5.2% on Wednesday.Japan’s Topix index closed 1% higher.Hong Kong’s Hang Seng lost 2%.The Shanghai Composite dipped 1%.Australia’s S&P/ASX 200 Index fell 3.4%.South Korea’s Kospi index tumbled 8.4%.Euro Stoxx 50 futures rose 0.4%.CurrenciesThe yen was at 108.97 per dollar, down 0.8%.The offshore yuan fell 0.6% to 7.1154 per dollar.The pound was at $1.1546, down 0.5%.The Aussie bought 56.63 U.S. cents, down 2%.The euro traded at $1.0911, down 0.1%.BondsThe yield on 10-year Treasuries rose three basis points to 1.23%.Australia’s 10-year yield surged 28 basis points to 1.49%.CommoditiesWest Texas Intermediate crude added 9% to $22.22 a barrel.Gold was down 0.1% at $1,484 an ounce.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
https://finance.yahoo.com/news/turmoil-rocks-assets-dollar-stocks-213530125.html?.tsrc=rss
