Selloff or Market Correction? Either Way, Here's What to Do NextSee Overvalued Stocks

GLOBAL MARKETS-Stocks rebound as weaker dollar lifts copper, oil

Published 06/06/2016, 10:19 pm
© Reuters.  GLOBAL MARKETS-Stocks rebound as weaker dollar lifts copper, oil
EUR/USD
-
USD/JPY
-
UK100
-
AXJO
-
JP225
-
RIO
-
AAL
-
HG
-
LCO
-
ESH25
-
1YMH25
-
DE10YT=RR
-
US10YT=X
-
IT10YT=RR
-
STOXX
-
FTEU3
-
MIAPJ0000PUS
-
DXY
-
SXPP
-

* Stocks rise in Europe and Asia, lifted by commodities

* Dollar near post-jobs report lows, lifting copper, gold, oil

* Traders rule out June Fed hike, await Yellen speech

By Nigel Stephenson

LONDON, June 6 (Reuters) - Shares rose in Europe and Asia on Monday, helped by commodity stocks as the dollar remained near its lowest in more than three weeks, after surprisingly weak jobs data led investors to push back expectations for an increase in U.S. interest rates.

Wall Street looked set to follow suit and rebound from the declines triggered by Friday's non-farm payrolls data, according to index futures ESc1 SPc1 1YMc1 .

Yields on low-risk U.S. Treasuries fell as expectations faded that rates would rise soon, remaining near almost two-month lows touched after Friday's data. Their German equivalents held close to record-low levels.

The focus for traders and investors shifted to a speech on the economy and monetary policy later on Monday by Federal Reserve Chair Janet Yellen, who will appear at the World Affairs Council of Philadelphia at 1630 GMT sterling fell more than 1 percent on the day at one point. Opinion polls published over the weekend showed growing support for Britain's voting to leave the European Union in a June 23 referendum pan-European FTSEurofirst 300 stocks index .FTEU3 gained 0.2 percent, having fallen around 1 percent on Friday. Britain's FTSE 100 .FTSE , which includes several major mining and oil and gas companies, rose 1 percent.

The STOXX 600 basic resources index .SXPP was up 3.5 percent. Anglo American AAL.L rose 8.5 percent and Rio Tinto RIO.L 6.3 percent.

"The mining sector is bouncing up on the back of the weaker dollar," Hantec Markets' analyst Richard Perry said.

The price of copper CMCU3 reached a four-week high. Brent crude oil rose above $50 a barrel.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose nearly 1 percent. Australia's mining-heavy S&P/ASX 200 index .AXJO closed up 0.8 percent.

However, a stronger yen against the dollar helped push Japan's Nikkei stock index .N225 down 0.4 percent.

The dollar, which suffered its biggest one-day drop against a basket of major currencies .DXY in four months on Friday, recovered some of the lost ground on Monday, rising 0.1 percent.

After dropping to a one-month low of 106.35 yen JPY= on Friday, the dollar rose 0.5 percent to 107.08 yen. The euro fell 0.2 percent to $1.1343 per euro EUR= .

"Rate hike expectations for June have disappeared. And while the focus has shifted to July, we expect the dollar to be rather subdued this week, with not much of economic data out of the U.S.," said Yujiro Goto, a currency strategist at Nomura.

Sterling GBP= fell 0.8 percent to $1.4409, having earlier fallen more than 1 percent to a low $1.4350 on the polls showing increased support for "Brexit".

U.S. 10-year yields US10YT=RR , which fell to 1.697 percent, their lowest in almost two months, on Friday, stood at 1.721 percent, up 1.7 basis points.

BUND YIELDS DIP

German 10-year Bunds DE10YT=TWEB , the benchmark for euro zone borrowing costs, rebounded to 0.78 percent, up 0.5 bps. They fell as far as 0.065 percent on Friday, their lowest in more than a year, and remained close to a record low of 0.05 percent hit in April 2015.

The British opinion polls and gains by the anti-establishment 5-Star Movement in weekend Italian municipal elections also supported Bunds.

"We have a poll showing the leave camp in the lead in the UK and in Italy we see the 5-Star Movement gaining ground, so political risk is a key issue," said KBC strategist Piet Lammens.

Italian 10-year yields IT10YT=TWEB rose 6.6 bps to 1.41 percent after the electoral setback for the government.

Brent crude LCOc1 last traded at $50.21 a barrel, up more than 1 percent on the day, also helped by attacks on Nigerian oil infrastructure O/R .

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.