Global stocks fight back after weak start; oil advances
U.S. stock futures and European shares struggled for traction after a selloff in Asia, as tension between America and Saudi Arabia added to a list of investor concerns and drove up oil prices. Gold rose with the yen as the U.S. dollar fell.
S&P 500 contracts trimmed earlier declines as did the Stoxx Europe 600 as sentiment improved during the European morning, with the Saudi government launching a probe into the disappearance of journalist Jamal Khashoggi. In Asia, equities fell in Japan and Hong Kong and China’s stocks touched the lowest in almost four years following a weekend of warnings on global economic fragility from finance chiefs meeting at an annual IMF gathering.
The Bloomberg Dollar Spot Index weakened while Treasuries were steady amid the risk-averse mood. U.S. retail sales disappointed in September. Gold headed toward its fourth advance in five days. Oil climbed. Abu Dhabi shelved plans for an IPO of its Spanish oil refiner Cepsa as investors balked at the valuation amid the stock-market rout.
Some of the worries that helped fuel the worst sell-off in global stocks since February were on full display in headlines over the weekend. IMF Managing Director Christine Lagarde warned of more market volatility. President Donald Trump threatened to impose another round of tariffs on China, and the Asian nation’s ambassador to the U.S., in a rare American TV appearance, on Sunday said his nation didn’t want a trade war but will respond.
“The breakdown in Brexit talks, the disappearance of dissident Saudi journalist Jamal Khashoggi, the demise of the CSU in Bavarian elections, the impasse over Italy’s budget and the worried tone coming from the IMF/World Bank meeting in Bali all combine to give financial markets an uncomfortable feel this morning,” Kit Juckes, global foreign-exchange strategist at Societe Generale SA, wrote in a note.
These are the main moves in markets:
Stocks
The Stoxx Europe 600 Index rose 0.1 per cent as of 8:30 a.m. New York time. Futures on the S&P 500 Index fell 0.1 per cent. The MSCI All-Country World Index dipped 0.1 per cent. The MSCI Emerging Market Index declined 0.7 per cent.
Currencies
The Bloomberg Dollar Spot Index dipped 0.2 per cent to the lowest in more than two weeks. The euro climbed 0.2 per cent to US$1.1587. The Japanese yen gained 0.3 per cent to 111.86 per dollar, the strongest in four weeks. The MSCI Emerging Markets Currency Index advanced 0.2 per cent to 1,596.24 per euro, the highest in more than a week.
Bonds
The yield on 10-year Treasuries decreased one basis point to 3.15 per cent. Germany’s 10-year yield fell less than one basis point to 0.50 per cent, the lowest in more than a week. Britain’s 10-year yield dipped two basis points to 1.609 per cent, the lowest in more than a week. The spread of Italy’s 10-year bonds over Germany’s declined three basis points.
Commodities
The Bloomberg Commodity Index gained 0.8 per cent, the largest gain in almost two weeks. West Texas Intermediate crude increased 0.8 per cent to US$71.93 a barrel. LME copper fell less than 0.05 per cent to US$6,299.50 per metric ton. Gold gained 1.1 per cent to US$1,230.60 an ounce, the highest in almost 12 weeks.
Source: BNN Bloomberg
https://www.bnnbloomberg.ca/global-stocks-fight-back-after-weak-start-oil-advances-1.1152194
