US stocks jump most since April as relief rally is on

All major US benchmarks were up at least 1.5%. The S&P 500 which is looking to snap a six-day losing streak totaling 6.8%, climbed the most since April.

Oct 12, 2018 02:10 IST India Infoline News Service

US stocks surged on Friday, joining a global rally in equities after two days of market tumult as trade tensions between the US and China seemed to ease, at least temporarily. The countries are planning to meet in November and the Treasury Department saying that China isn’t manipulating its currency.

Treasuries slipped, the dollar was steady and crude climbed above $71 a barrel.

All major US benchmarks were up at least 1.5%. The S&P 500 which is looking to snap a six-day losing streak totaling 6.8%, climbed the most since April. Tech drove the strength as the Nasdaq 100 Index jumped more than 2%.

Banks were among the best performers as JPMorgan Chase & Co., Citigroup Inc., and Wells Fargo & Co. kicked off the third-quarter earnings season with mostly positive results.

Strong trade data from China also buoyed markets, with the MSCI Asia Pacific Index rising from the lowest level since May 2017. China trade data showed exports rebounded, while imports remained robust, thanks to strong demand at home and abroad despite worsening relations with the US That eased some concern about the impact of the trade war, which had contributed to the worst equity sell-off since February amid worries about the Federal Reserve’s policy path.

Emerging-market stocks headed for the biggest gain in more than two years as risk appetite improved, and most developing-nation currencies advanced against the dollar. The Stoxx Europe 600 index gained for the first time in three days, with miners leading the advance and most sectors in the green, though the gauge is still headed for its worst week since February.

Meanwhile, as traders debate whether the correction has created immediate buying opportunities, earnings remain key as third-quarter reports from US companies will show whether the Trump Administration’s tax breaks are still boosting corporate profits.

“We expect further volatility and possible additional down moves,” though “the bear checklist is not yet flashing red,” Pascal Blanque, chief investment office at Amundi SA, said in a client note. “The focus will be on the US earnings season, so any news will be carefully assessed by the market.”

West Texas crude recovered but remained on track for the biggest weekly drop since May. The International Energy Agency cut forecasts for demand this year, but said dwindling supply will keep prices high. Gold slipped, but copper led a gauge of industrial metals higher.

These are the main moves in markets:

  • The S&P 500 was up 1.5% as of 9:41 AM in New York.
  • The Stoxx Europe 600 Index climbed 0.7%, the biggest gain in more than three weeks.
  • The MSCI All-Country World Index rose 0.4%.
  • The UK’s FTSE 100 Index increased 0.7%.
  • Germany’s DAX Index added 0.8%.
  • The MSCI Emerging Market Index surged 2.4%, the first advance in more than a week and the largest jump in more than two years.

  • The Bloomberg Dollar Spot Index climbed less than 0.05%.
  • The euro declined 0.2% to $1.1573.
  • The British pound fell 0.3%, the largest drop in more than a week.
  • The Japanese yen dipped 0.1% to 112.32 per dollar, the first retreat in more than a week.

  • The yield on 10-year Treasuries gained one basis point to 3.16%.
  • Germany’s 10-year yield decreased less than one basis point to 0.52%.
  • Britain’s 10-year yield fell three basis points to 1.644%.
  • Japan’s 10-year yield increased less than one basis point to 0.15%.

  • West Texas Intermediate crude gained 1.3% to $71.90 a barrel, the largest rise in more than a week.
  • Gold decreased 0.1% to $1,223.25 an ounce.
  • Copper increased 0.7% to $2.82 a pound, the highest in more than a week.

Source: Bloomberg

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