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Global stocks bulls halt their charge

EconomyNov 12, 2020 05:25AM ET
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© Reuters. FILE PHOTO: A man wearing a protective face mask walks past a stock quotation board outside a brokerage, amid the coronavirus disease (COVID-19) outbreak, in Tokyo

By Marc Jones

LONDON (Reuters) - Global shares were on course on Thursday to end their longest winning streak in over a year, one that has lifted them more than 10%, as the post-U.S. election and coronavirus vaccine bull run paused.

Europe's main markets opened down 0.7% and Wall Street futures fell. For the first time in November, MSCI's 49-country world index was in the red. Asia had finished flat.

Big Tech had rebounded on Wednesday as investors switched back to winners like Amazon (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX). In Europe, investors returned to safe-haven government bonds.

"What we don't really agree with is that you need to rotate out of tech into value stocks," said Willem Sels, chief market strategist at HSBC Private Bank, referring to stocks that do well in normal circumstances when economies are open.

"We don't think either that a recovery (helped by a vaccine) would lead to a sustained sell-off in U.S. Treasuries. The Fed has signalled it is on hold," he added.

In the currency market, the euro was near $1.18, in the middle of the $1.16-$1.20 range it's been in since late July. Sterling was down 0.5% amid more Brexit uncertainty and as data showed the UK economy losing speed again.

Turkey's lira took a breather after President Tayyip Erdogan's promise to overhaul unconventional monetary policy and the replacement of his son-in-law as finance minister caused it to rise 10%. [EMRG/FRX]

The New Zealand dollar soared for a second session to a 19-month high as investors unwound bets on the introduction of negative interest rates.

The kiwi got an added boost after Reserve Bank of New Zealand Assistant Governor Christian Hawkesby said the economy required less stimulus than it did in August.

"The weakness in broad USD (dollar) and reflationary momentum in equities, which we saw on the back of the U.S. election and improvements in the vaccine situation, seem to be fading across FX and equities," said Christin Tuxen, Head of FX Research at Danske Bank.

HOLD GOLD

Global oil benchmark Brent snapped three consecutive days of gains to dip to $43.46 a barrel, although it remained near a two-month high.

Traders were tempering expectations of an early release of a COVID-19 vaccine. The International Energy Agency also raised doubts on Thursday about a quick recovery in demand, amid surging infections in Europe and the United States.

Most of Europe's main economies are already grappling with a wave of infections and new social restrictions. New York also ordered bars and restaurants to start closing early on Wednesday after U.S. cases hit records.

Until the timing of the availability of a vaccine becomes clearer, oil prices "downside could turn out to be limited, but serious upside potential is unlikely to develop in the immediate future," said Tamas Varga, analyst at PVM Oil.

The Organization of the Petroleum Exporting Countries also revised its demand forecast on Wednesday, saying global oil demand will recover more slowly in 2021 than previously expected because of rising coronavirus cases.

Safe-haven gold edged up. Spot gold rose 0.4% to $1,872 per ounce, while U.S. gold futures were 0.3% higher.

"We still have some gold," HSBC's Sels said. "With Europe still in lockdown and some political risks remaining, you can't put all your chips on one colour."

Global stocks bulls halt their charge
 

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Comments (10)
perplexed76 .
perplexed76 . Nov 12, 2020 12:48AM ET
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breakin news: Pfizer vaccine must be kept at -80°С. That's a problem. But not for paper traders.
Indiana Jones
Indiana Jones Nov 12, 2020 12:48AM ET
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Hint: CYRX
Lake Lot
Lake Lot Nov 12, 2020 12:48AM ET
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Bought freezer companies
perplexed76 .
perplexed76 . Nov 12, 2020 12:18AM ET
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vaccine hope rally exausted, time for stimulus.
Brandon Laviolette
Brandon Laviolette Nov 12, 2020 12:18AM ET
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There will be no stimulus until next year lol
Thom Miller
Thom Miller Nov 11, 2020 11:05PM ET
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To Stefon Sauerwein below....Sauerwein? Sauerwein isn’t a Texas name. Sounds to me like you’re all matzah and no yeast....We don’t want your kind in our country since the embassy was moved. Texas has had more Covid deaths than any state in the union over the past 5 months. Nice job, Governor Abbott! Real nice job! Send your people to their graves. LOL! Oh, and Trump lost by over 5 million popular votes and 50 Electoral votes. Landslide Joe! Landslide Joe! Landslide Joe.
Val Lange
Val Lange Nov 11, 2020 10:37PM ET
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Interest rate cut would be good option
Thom Miller
Thom Miller Nov 11, 2020 10:37PM ET
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To what? - 1%?
Covid Altzheimer
Covid Altzheimer Nov 11, 2020 10:37PM ET
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how low minus would you want ot?
Daniel Lu
Daniel Lu Nov 11, 2020 10:27PM ET
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Just went down from the historical high and now its time to short the stocks
James Bell
James Bell Nov 11, 2020 10:21PM ET
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biden considering 6 week lockdown to stop the virus. timber!
Thom Miller
Thom Miller Nov 11, 2020 10:21PM ET
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Trump considering 6 week stall in conceding. timber!
perplexed76 .
perplexed76 . Nov 11, 2020 10:21PM ET
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you are losing the same money at hospitals. But you are losing people either.
Elvis Durant
Elvis Durant Nov 11, 2020 10:13PM ET
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Typical Reuters Manipulation. Gotta get rid of Reuters equally = to How Trump got OUSTED.......Need to start there with Reuters Lame NEWS
Ronald Warren
Ronald Warren Nov 11, 2020 9:48PM ET
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Stinkin' Crazy!! The vaccine is useless. Stored at -97 degrees f. Maybe they can vaccinate penguins in antartica.
Thom Miller
Thom Miller Nov 11, 2020 9:41PM ET
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That vaccine is doing a hellava job on the futures markets......
Don Getty
Don Getty Nov 11, 2020 9:41PM ET
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everyone read today that Phizers CEO sold 2/3 of his shares the same day as their big announcement - if the vaccine is such a great product - that would be a very unusual move - which sort of implies - peer review may not be so glowing!
Eric Carpenter
Eric Carpenter Nov 11, 2020 8:16PM ET
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Yall need new pics
Thom Miller
Thom Miller Nov 11, 2020 8:16PM ET
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Yall? Spoken like a true Trumper from the southern swamp. Hey, do you have schools and shoes down there yet? Do “yall” still marry your first cousins?
 
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