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GLOBAL MARKETS-Asia shares rally as BOJ buys more bonds; U.S. crude skids

Published 27/04/2020, 03:27 pm
© Reuters.
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* Asian stock markets : https://tmsnrt.rs/2zpUAr4

* Nikkei rises on BOJ pledge to buy unlimited bonds

* Fed and ECB to meet later in week

* Raft of major U.S. corporate earnings due this week

* Oil prices fall anew as world runs short of storage space

By Wayne Cole

SYDNEY, April 27 (Reuters) - Asian shares bounced on Monday as the Bank of Japan (BOJ) announced more stimulus steps to help cushion the economic impact of the coronavirus, while oil took another spill as the world ran short of space to store it.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 1.8%, taking back a chunk of last week's 2.6% decline. Japan's Nikkei .N225 gained 2.6%, and Chinese blue chips .CSI300 1%.

After a soft start, E-Mini futures for the S&P 500 ESc1 climbed 1%, while EUROSTOXX 50 futures STXEc1 added 2.6% and FTSE futures FFIc1 1.5%.

The BOJ matched market speculation by pledging to buy unlimited amounts of government bonds, removing its previous target of 80 trillion yen per year. sharply raised purchases of corporate and commercial debt, and eased rules for what debt would qualify.

The Federal Reserve and the European Central Bank meet later in the week, with the latter likely to do more bond buying.

"For the Fed, no further developments on QE or interest rates are expected, but we expect it to underline that its policies will be in place indefinitely to support the economy," ANZ wrote in a research note.

"We expect the ECB to raise the size of its emergency bond buying package (PEPP) by around 500 billion euros to 1.250 trillion and to continue pressing for a sizeable fiscal stimulus."

On the data front, the United States and European Union release GDP for the first quarter and the influential U.S. ISM survey on manufacturing.

Earnings season will be in full swing with around 173 companies in the S&P 500 reporting this week, including Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN) FB.O , Microsoft MSFT.O , Caterpillar (NYSE:CAT) CAT.N , Ford F.N , General Electric (NYSE:GE) GE.N and Chevron (NYSE:CVX) CVX.N .

Analysts expect a 15% decline in S&P 500 first-quarter earnings, with profits for the energy sector estimated to slump more than 60%, raising fears of debt defaults, layoffs and possible bankruptcies. markets remain well supported by the truly massive easing under way from major central banks, which have seen U.S. 10-year yields US10YT=RR trade around 0.6% for a week or more.

The dollar has been generally well bid thanks to its safe haven status as the world's most liquid currency at times of stress, although moves have been relatively mild in recent weeks.

The dollar index =USD touched a three-week high at 100.860 on Friday before easing back to 100.150 on Monday amid an improvement in risk appetite.

The euro edged up to $1.0843 EUR= , having hit a one-month low of $1.0725 on Friday, while the dollar eased slightly on the yen to 107.24 JPY= . USD/

Gold held at $1,722 per ounce XAU= , after gaining 2.5% last week. GOL/

Oil prices looked set for another volatile week, having fallen in eight of the last nine weeks. U.S. crude even traded below zero last week as demand collapsed 30% due to the pandemic, leaving more oil than could be stored. O/R

U.S. crude CLc1 slid $1.61 to $15.33, while Brent crude LCOc1 futures slipped 46 cents to $20.98 a barrel.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Asia stock markets

https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations

https://tmsnrt.rs/2Dr2BQA

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Editing by Jacqueline Wong and Raju Gopalakrishnan)

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