Stocks Slip After Historic Rally; Dollar Rises: Markets Wrap

(Bloomberg) — European stocks and U.S. futures edged lower, as momentum slowed in risk assets after a historic rally. Treasuries advanced.

The Stoxx Europe 600 Index opened with declines in banks undercutting gains in travel shares. Asian shares continued higher, just hours after investors pushed the S&P 500 Index back into positive territory for 2020. The dollar strengthened for the first day in nine sessions.

With global equities rebounding to their levels in February, concern that the bounce back has far overshot the economic recovery continues to weigh on investors. The World Bank warned the global economy will contract the most since World War II this year, reducing incomes and sending millions of people into poverty in emerging and developing nations.

“There are a lot of unknowns that we are dealing with despite the fact that normalizations of economic activities are still on track,” Frank Tsui, a senior fund manager at Value Partners, said on Bloomberg TV. “There are still a lot of unknown factors.”

On the policy front, the Federal Reserve expanded its Main Street Lending Program, allowing more companies to participate and lessening the burden on banks that create the loans. The move came ahead of the Fed’s policy meeting Wednesday.

S&P Erases Loss and Ed Yardeni Doubts It Was Ever a Bear Market.

What to watch this week:

The Fed’s next policy decision is Wednesday. Officials are expected to leave rates above zero.OECD releases its economic outlook Wednesday, a twice-yearly analysis of the economic prospects of member countriesEuro-area finance ministers meet Thursday to discuss the EU’s recovery package and Eurogroup presidency succession.

These are some of the main moves in markets:

Stocks

The Stoxx Europe 600 Index was little changed at 8:17 a.m. London time.Futures on the S&P 500 Index decreased 0.2%.Nasdaq 100 Index futures were little changed.The MSCI Asia Pacific Index increased 0.7%.

Currencies

The Bloomberg Dollar Spot Index increased 0.2%.The euro declined 0.2% to $1.1267.The British pound dipped 0.4% to $1.2678.The Japanese yen strengthened 0.4% to 108.05 per dollar.

Bonds

The yield on 10-year Treasuries sank four basis points to 0.83%.The yield on 30-year Treasuries sank five basis points to 1.59%.Germany’s 10-year yield declined one basis point to -0.33%.Britain’s 10-year yield declined two basis points to 0.313%.

Commodities

Brent crude was little changed at $40.82 a barrel.Gold was little changed at $1,697.79 an ounce.Iron ore decreased 1.5% to $100.76 per metric ton.

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.