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GLOBAL MARKETS-Shares hit record peak on upbeat results, dollar eases

Published 27/08/2020, 02:19 am
© Reuters.
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(Adds U.S. market open, byline, dateline; previous LONDON)

* MSCI's all-country world index hits new all-time high

* Nasdaq, S&P 500 also hit new intraday highs

* Fed chair due to speak at Jackson Hole on Thursday

* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn

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

By Herbert Lash

NEW YORK, Aug 26 (Reuters) - A gauge of global equity markets hit an all-time peak on Wednesday, after the S&P 500 and Nasdaq indexes set fresh records on upbeat corporate results, while the dollar eased ahead of a highly anticipated speech by Federal Reserve Chairman Jerome Powell.

MSCI's all-country world index surged past a pre-COVID high reached in February as investors drove up technology stocks after Salesforce.com Inc (NYSE:CRM) raised its annual revenue forecast on surging demand for its online business software. to the upbeat mood was early data from Moderna 's MRNA.O experimental COVID-19 vaccine which showed it induced immune responses in older adults that were similar to those for younger participants. S&P 500 and the Nasdaq have hit daily record closing highs since Friday, driven by demand for tech-focused stocks, government stimulus and record low interest rates.

Better-than-expected economic data in Europe has lifted analysts expectations for earnings, driving regional bourses higher. Benchmark indexes in Frankfurt .GDAXI , Paris .FCHI and London .FTSE closed up 0.98%, 0.66% and 0.14%, respectively.

The likelihood of a COVID-19 vaccine being introduced in early 2021 combined with very low interest rates and the likelihood rates stay low for longer are driving equities higher, said Sam Stovall, chief investment strategist at CFRA in New York.

"Until we really start to see a worry that interest rates are likely to start to move higher, I still see growth in general, tech and consumer discretionary in particular, holding up very well," he said.

The MSCI index .MIWD00000PUS , a gauge of equity performance in 49 countries, rose 0.56% to 582.11, passing its previous record of 581.02, while Europe's broad FTSEurofirst 300 index .FTEU3 added 0.80% to 1,446.47.

On Wall Street, the Dow Jones Industrial Average .DJI fell 0.05%, the S&P 500 .SPX gained 0.50% and the Nasdaq Composite .IXIC added 1.14%.

Salesforce.com CRM.N , which is set to enter the blue-chip Dow index .DJI next week, jumped 25.1%.

Investors are betting that when he speaks on Thursday, Powell will create expectations of more inflation, said Jim Vogel, interest rate strategist for FHN Financial.

Powell is scheduled to address the Fed's policy framework review and investors are focused on whether he will hint at shifting the U.S. central bank's inflation target to an average.

The dollar index, which tracks the greenback's value against a basket of currencies =USD fell 0.056%.

Earlier the index hit a session high of 93.37 after data showed that U.S. durable goods orders increased more than expected in July. euro EUR= fell 0.08% to $1.1824.

The 10-year U.S. Treasury US10YT=RR note rose 2.8 basis points to 0.7096%.

Euro zone bonds were flat, with safe-haven Bund yields DE10YT=RR rising a smidgeon after enduring on Tuesday their biggest daily losses since May as better German economic data and trade dented hunger for government debt. prices traded little changed, pressured by worries about the demand outlook during the coronavirus pandemic but buoyed as U.S. producers shut output in the Gulf of Mexico ahead of Hurricane Laura.

Producers evacuated 310 offshore facilities and shut 1.56 million barrels per day of crude output, 84% of Gulf of Mexico's offshore production - near the 90% outage that Hurricane Katrina brought 15 years ago.

Brent crude futures LCOc1 fell $0.13 to $45.73 a barrel. U.S. crude futures CLc1 gained $0.03, to $43.38 a barrel.

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