NVDA gained a massive 197% since our AI first added it in November - is it time to sell? 🤔Read more

GLOBAL MARKETS-Stocks rise, dollar slips as risk aversion eases

Published 29/01/2021, 04:30 am
© Reuters.
EUR/USD
-
USD/JPY
-
XAU/USD
-
US500
-
DJI
-
DX
-
GC
-
LCO
-
CL
-
GME
-
IXIC
-
FTEU3
-
MIWD00000PUS
-

(Adds U.S. market prices)

* U.S. GDP data in Q4 not as bad as full year 2020

* Social-media trading restrictions boost Wall Street

By Herbert Lash and Huw Jones

NEW YORK/LONDON, Jan 28 (Reuters) - The dollar retreated and Wall Street rallied on Thursday as investors looked past weak U.S. GDP and jobless claims data to hopes of a rosier economy ahead and welcomed restrictions on the social media-driven trading frenzy.

Online trading platforms Robinhood and Interactive Brokers restricted trading in shares of GameStop (NYSE:GME) GME.N , BlackBerry BB.N and other companies that saw hefty gains this week after they were targeted by an army of retail buyers. of GameStop plunged about 44% from Wednesday's close, to $196.14, after hitting $483 earlier in the session. The shares had traded under $20 at the beginning of the year.

Hedge funds would have had more margin calls if GameStop had kept going higher, said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

"When it backed off a little bit, the market breathed a sigh of relief," Hayes said.

The main Wall Street indexes on Wednesday registered their sharpest declines in three months after a squeeze on hedge funds holding short positions in the social-media darlings.

MSCI's benchmark for global equity markets .MIWD00000PUS rose 0.88% to 658.22, while the Dow Jones Industrial Average .DJI rose 2%, the S&P 500 .SPX gained 2.00% and the Nasdaq Composite .IXIC added 1.5%.

Stocks in Europe traded little changed as countries grappled with new variants of the coronavirus amid extended lockdowns that weigh on near-term economic growth. The broad FTSEurofirst 300 index .FTEU3 added 0.01% to 1,554.45.

The safe-haven U.S. dollar fell in choppy trading and riskier currencies, including the Australian dollar, reversed early losses as stocks rebounded.

U.S. gross domestic product grew at a 4% annualized rate in the fourth quarter, in line with economists' forecasts, though for all of 2020 the economy contracted 3.5%, the worst performance since World War Two. GDP contracted over all of last year, data suggested a faster recovery than many expected. Other reports showed U.S. jobless claims were lower than expected at 847,000, compared with forecasts of 875,000.

The dollar index =USD fell 0.161%, with the euro EUR= up 0.12% to $1.2122.

The Japanese yen JPY= weakened 0.16% versus the greenback at 104.28 per dollar.

U.S. long-dated Treasury yields rallied from three-week lows. The U.S. government will auction $62 billion in U.S. seven-year Treasury notes.

"The Treasury market is operating under the assumption that we will be hitting a soft patch here in the first quarter," said Kevin Flanagan, head of fixed income strategy at WisdomTree. "The numbers are kind of being ignored," he said.

Oil was steady as the impact of a weaker dollar and big U.S. crude inventory drawdown offset concerns that delays to vaccine rollouts and fresh travel curbs to prevent new coronavirus outbreaks could depress demand.

Brent crude futures LCOc1 fell $0.13 to $55.68 a barrel. U.S. crude futures CLc1 slid $0.38 to $52.47 a barrel.

Spot gold prices XAU= fell -0.15% to $1,841.21 an ounce.

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

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

https://tmsnrt.rs/2Dr2BQA

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

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.