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GLOBAL MARKETS-Dow Jones Industrial index hits record high again, USD languishes

Published 11/05/2021, 03:57 am
Updated 11/05/2021, 04:00 am
© Reuters.
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* World shares climb to fresh record high, up 0.2%

* Copper prices at all-time peak

* Cyber attack on U.S. pipeline lifts oil prices

* Shock U.S. jobs data ease concerns over Fed rate hikes

* Dollar nurses losses, sterling rises above $1.40 (Updates throughout)

By Koh Gui Qing

NEW YORK, May 10 (Reuters) - The Dow Jones Industrial Average jumped to a record high for the sixth consecutive session on Monday as investors bet on interest rates staying low to help a still-fragile U.S. economy, which in turned dragged the U.S. dollar to a 2-1/2-month low.

Oil prices pared earlier gains as concerns that rising COVID-19 cases in Asia will dampen demand outweighed the impact of the shutdown of major fuel pipelines in the United States following a cyber attack. O/R

The Dow Jones Industrial Average .DJI climbed 0.69% while the S&P 500 .SPX edged down 0.11%, and the Nasdaq Composite .IXIC shed 1.5%. .N

The buoyancy in the Dow was mirrored in stock markets elsewhere, with Europe's STOXX 600 .STOXX index also inching up to an all-time high as mining stocks leapt on record copper prices.

Expectations of improved demand amid a tightening supply have helped copper prices to shoot higher, with the rally amplified by investors piling in for fear they might be missing out. MET/L

With many asset prices flying at all-time highs, some counselled caution.

"I have never seen a market this frothy in 50 years," said Harry Clark, chairman and founder of Clark Management Group, which manages over $45 billion.

"We are going to go into a correction some time soon and caution is the word on my mind today."

Indeed, some currency investors appeared to be less upbeat than their equity counterparts as they sold the dollar on bets that the U.S. economic recovery would be slower than expected. USD/

By midday, the dollar index =USD had pared earlier losses but still held at a 2-1/2-month low of 90.153.

A softer dollar gave a fillip to the pound, which broke above the key $1.40 level for the first time in more than two months, even as pro-independence parties in Scottish elections won a majority. GBP/

The pound was up 1.06% against the dollar at $1.41355 GBP=D3 .

A weaker dollar also helped to boost gold prices. Spot gold XAU= rose 0.3% to $1,836.00 per ounce, after touching its highest since Feb. 11 at $1,845.06. GOL/

In recent weeks, some investors had been placing bets that a robust U.S. economic recovery from the coronavirus pandemic would force the Fed to tighten policy earlier than the central bank has outlined.

However, a weak nonfarm payrolls report on Friday caused a rapid reversal in some of these trades, which rippled through stocks, bonds and major currencies.

U.S. President Joe Biden said after the report that the figures showed the economy was not at risk of overheating and underscored how vital his administration's economic actions are. focus now shifts to U.S. consumer price data due on Wednesday, which will help investors determine whether they need to scale back their inflation expectations even further.

Longer-dated U.S. Treasury yields edged higher on Monday as investors eyed the inflation data due this week. The yield on benchmark 10-year Treasury notes US10YT=RR stood at 1.5914% after plunging to a two-month low of 1.469% on Friday.

In the cryptocurrency market, ether ETH=BTSP rose to a fresh record above $4,000 and was last up 6.3%. Bigger rival bitcoin BTC=BTSP fell 1.3% to $57,580.

Brent crude LCOc1 rose 0.15% to $68.38 per barrel as the disruption to U.S. supplies rattled energy markets, while U.S. crude CLc1 also added 0.15% to $65 a barrel.

The White House was working closely with top U.S. fuel pipeline operator Colonial Pipeline to help it recover from the ransomware attack that forced the company to shut its main fuel lines. World FX rates YTD

http://tmsnrt.rs/2egbfVh Global asset performance

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