Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Stocks rebound grinds past 10% after $2 trln U.S. stimulus boost

Stock MarketsMar 25, 2020 09:30
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

* MSCI ACWI builds on biggest gains since 2008 financial crisis

* Wall Street expect to open lower though after monster jumps

* Gold retain most of gains after big jump

* Dollar slides as funding squeeze eases a little

* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

By Marc Jones

LONDON, March 25 (Reuters) - A breakneck rebound in world stocks made it past the 10% mark on Wednesday before more global coronavirus warnings and fresh turbulence in commodity markets saw things grind to a halt.

Hopes that an incoming $2 trillion U.S. fiscal stimulus will ease the economic devastation caused by virus lockdowns gave world equity indexes .MIWD00000PUS their first back-to-back gains in a month, though wasn't plain sailing.

Europe's main markets in London, Frankfurt and Paris were struggling to stay positive after tearing 4%-5% higher and oil prices swung from 3% up to 3% down, while Wall Street looked set to open lower after Tuesday's stellar surge. .EU .T .N

The Dow Jones Industrial Average .DJI had soared over 11% in its biggest one-day percentage gain since 1933 and the S&P 500 scored a 9.4% jump - its tenth best day on record out of 24,067 trading sessions since daily data started in 1927.

"The right steps have been taken but the main thing that is driving the market at the moment is sentiment," said Chris Dyer, Director of Global Equity at fund manager Eaton (NYSE:ETN) Vance.

He said it was now vital to see some positive signs on combatting the epidemic and that health systems were not being overwhelmed. "Market direction can change very, very quickly depending on one item of news or one development," he added.

The U.S. stimulus deal is expected to include $500 billion in direct payments to people and $500 billion in liquidity assistance. Donald Trump had also pressed his case for a re-opening of the U.S. economy by mid-April, though that met with immediate scepticism given the rise in infections in the United States is now among the biggest in the world.

In particular, its financial hub of New York City suffered another big increase, fuelling worries about a shortage of hospital beds. Europe too, there were more high-profile cases including Britain's Prince of Wales, while an internal EU document seen by Reuters showed the bloc needs 10 times more protective equipment and devices like ventilators than traditional supply chains can provide. equities are clearly a better value proposition than they were a month ago, but we would exercise caution against value opportunities becoming value traps," said Tim Graf, head of Macro Strategy EMEA at State Street (NYSE:STT) Global Markets.

"Bull markets do not typically begin with 10 percent rallies in a single day, even if the policy response to this crisis has been more expansive and powerful than any previously offered."

DOLLAR DE-STRESS

In the U.S., the benchmark S&P 500 is still nearly $8 trillion below its mid-February high, and investors expect more sharp swings. Wall Street's fear gauge .VIX eased overnight but was on the rise again ahead of Wednesday's open. .N

In the currency markets, the dollar slipped for a third straight session as the scramble for liquidity was soothed by the super-sized U.S. stimulus plan, though it was starting to look a little stronger again. /FRX

The risk-sensitive Australian dollar AUD=D3 jumped over the 60-U.S. cent mark for the first time in a week and the euro traded up 0.3% past $1.0835 EUR= and, with traders moving gradually away from safety boltholes, the Japanese yen eased to 111.34 yen per dollar JPY= to leave it just off a one-month low.

Bond markets were also calmer. Benchmark U.S. Treasuries were yielding 0.86% while in Europe Germany's 10-year yield DE10YT=RR edged a basis point higher to -0.31%, tailed by other higher-rated government debt. NL10YT=RR , AT10YT=RR

In Italy, the epicentre of the virus in Europe, 10-year borrowing costs were unchanged at 1.59%; nearly half last week's high of 3.01% IT10YT=RR .

European Central Bank chief Christine Lagarde asked euro zone finance ministers during a videoconference on Tuesday evening to seriously consider a one-off joint debt issue of "coronabonds", officials also told Reuters. metals markets, gold changed hands at $1,610.0 per ounce XAU= , retaining most of Tuesday's gains of almost 5%, its biggest jump since 2008.

Oil prices buckled though another 3% as concerns about demand took over again. O/R

Brent crude futures LCOc1 pinballed from $27.51 per barrel to $26.22. That is up about $4, or 12%, from their 18-year intraday low on Friday, though on the month the market is down over 45%. (editing by John Stonestreet)

Stocks rebound grinds past 10% after $2 trln U.S. stimulus boost
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email