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REFILE-GLOBAL MARKETS-Google helps stock markets recover, oil tops $75

Published 2018-04-24, 07:25 a/m
© Reuters.  REFILE-GLOBAL MARKETS-Google helps stock markets recover, oil tops $75
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* Brent rises above $75 to highest since Nov 2014

* U.S. 10-year bond yield just off key 3 pct

* US stock futures higher, dollar firms vs yen

* Tech earnings in focus after recent turbulence for sector

* Graphic: World FX rates in 2018 http://tmsnrt.rs/2egbfVh

By Dhara Ranasinghe

LONDON, April 24 (Reuters) - World stocks steadied on Tuesday after three sessions of losses thanks to strong earnings from the likes of Google and as a rise in benchmark U.S. bond yields towards 3 percent stalled, while oil prices stretched to fresh highs above $75 a barrel.

U.S. stock futures pointed to a firm open on Wall Street ESc1 1YMc1 , although European shares .STOXX were mixed with stock markets in London .FTSE and Frankfurt .GDAXI around 0.3 percent higher and shares in Paris .FCHI flat.

Markets brushed off further signs that European powerhouse economy Germany is losing some of its momentum, with the Ifo business climate index falling in April. Asia, Japan's Nikkei .N225 added 0.9 percent as a lower yen supported export-heavy firms and Chinese shares posted their strongest gains in two months .CSI300 .SSEC . left MSCI's world equity index .MIWD00000PUS a tad higher after three days of declines.

The recovery in stocks came as bond markets also bounced back from a selloff. U.S. 10-year Treasury yields came within striking distance of the psychologically significant barrier of 3 percent US10YT=RR on Monday, which in the past has triggered market spasms.

"There's a tug and a pull from all kinds of things in equity markets right now, such as the approach of U.S. bond yields to 3 percent, but I don't think that would be the end of the world," said Lukas Daalder, chief investment officer at Robeco.

Earnings meanwhile, especially from the tech sector, were in focus after a turbulent few months for leading U.S. tech firms.

Google parent Alphabet GOOGL.O was up slightly in volatile after-hours trading on Monday after the tech giant reported a 73 percent jump in profits in the first quarter. AMS AMS.S reported first-quarter sales towards the lower end of its guidance range on Monday and warned of a downturn owing to weaker orders from one of its main customers. did not name the customer, but the Austrian company is a big supplier to Apple AAPL.O , making components for the iPhone.

SAP SAP.G , Europe's largest tech company by stock market valuation, meanwhile announced upbeat results in the seasonally tough first quarter. around 18 percent of the companies in the S&P 500 that have already reported, 78.2 percent beat consensus estimates.

OIL SURGE

Brent crude oil prices, the global benchmark, rose above $75 a barrel LCOc1 to their highest level since November 2014, supported by OPEC-led production cuts, strong demand and the prospect of renewed U.S. sanctions on Iran. O/R

U.S. West Texas Intermediate crude futures CLc1 were 0.5 percent higher at $69.11 a barrel.

A rally in oil prices and renewed focus on the inflation outlook has added to upward pressure on bond yields recently.

"It is this move higher in crude oil prices, along with the rise in demand, that is helping fuel the recent rise in yields as well as the positive tone for equity markets," said Michael Hewson, chief market analyst at CMC Markets in London.

"However if it continues too far we could start to see it act as a drag on equity markets, if prices along with yields start to move even higher."

ALL ABOUT BONDS

The fallout from rising U.S. bond yields, which have helped lift U.S. financial stocks, continued to be felt in currency markets.

The euro nursed losses at a two-month low on growing concerns that firmer Treasury yields would reduce incremental demand for the region's bonds and stocks at a time when hedge funds have amassed record long bets on the single currency.

It stabilised around $1.22 on Tuesday after having slumped to $1.2185 in Asia, its lowest since March 1.

The dollar set a two-month high of 108.87 yen JPY=EBS and was holding near those levels.

Elsewhere, aluminium CMAL3 hit its lowest in nearly two weeks, extending declines from the previous day after Washington gave U.S. companies more time to comply with sanctions on Russian producer Rusal 0486.HK and hinted at further sanctions relief. Global CPI and oil prices

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