Global stock selloff eases as yen falls with gold

Sydney - A global equities selloff that spurred the biggest drop in shares since Donald Trump’s election eased as investors stepped back before a key US vote on health care. The yen halted a seven-day rally and gold retreated.

European and Japanese shares were little changed while Australian and South Korean stocks rose after the S&P 500 Index nudged higher. Treasury 10-year yields were steady after four days of losses. The kiwi was flat after New Zealand’s central bank kept its benchmark rate at a record low 1.75%. Oil futures climbed.

The gains in US equities provided a measure of calm to the market after a selloff spread across Asia on Wednesday. Volatility spiked before a Republican health-care bill is set for a vote in Congress.

Lawmakers have signaled any setback could delay enactment of tax cuts and spending increases, the prospects for which have underpinned the rally in risk assets since Donald Trump’s election in November. The depth of selling drew some investors back in on speculation the drop went too far given data showing strength in the global economy.

The selloff was the biggest for stocks since the November election. Equities had largely escaped investors’ efforts this year to unwind so-called Trump trades. While the dollar has fallen 4.4% from a January peak, global stocks have climbed to new highs, with the MSCI All Country World Index reaching a record last week.

What’s coming up the rest of this week:

Fed chair Janet Yellen is due to speak Thursday at a conference in Washington. The timing of the House of Representatives vote on Thursday has not been set, with reports differing on whether the Republicans can marshal enough support to pass the health-care measure. March PMI and final fourth-quarter GDP figures for France are due on Friday.

Here are the main moves in markets:

Stocks

The Stoxx Europe 600 Index fluctuated between gains and losses as of 10:09. Japan’s Topix closed little changed after plunging 2.1% on Wednesday. Australia’s S&P/ASX 200 Index added 0.4%. The MSCI Emerging Market Index was little changed after falling 0.6% on Wednesday in its first retreat in almost two weeks.

The Hang Seng China Enterprises Index rose 0.3%, after tumbling 1.8% in the previous session. Indonesia’s benchmark index increased 0.6%. Futures on the S&P 500 increased 0.1%.

The benchmark gauge added 0.2% on Wednesday after plunging 1.2%, the most since October, in the previous session.

Currencies

The Bloomberg Dollar Spot Index rose 0.1% after a six-day slump, the longest string of losses since early November. The yen fell 0.1% to ¥111.22/$, after reaching the highest level since November on Wednesday.

The Australian dollar dropped 0.7% and the New Zealand dollar rose less than 0.1%. The British pound was little changed after London’s worst terror attack in more than a decade. Five people died, including the assailant and the police officer he stabbed, and at least 40 injured. The euro fell less than 0.1% to $1.0792.

Bonds

The yield on 10-year Treasuries rose less than one basis point to 2.41% after dropping in the previous four sessions. The yield on 10-year Australian government bonds was little changed at 2.76%.

Commodities

Gold fell 0.2% to $1 246.81, after a six-day advance that totaled 4.2%. Oil added 0.5% to $48.29 a barrel on speculation record US crude stockpiles that have undermined OPEC’s output cuts may finally be set to shrink. Iron ore advanced 0.6% after falling into a bear market on Wednesday.

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ZAR/USD
16.85
(+0.26)
ZAR/GBP
21.26
(+0.41)
ZAR/EUR
19.03
(+0.84)
ZAR/AUD
11.73
(+0.83)
ZAR/JPY
0.16
(+0.40)
Gold
1800.06
(-0.43)
Silver
18.61
(-0.27)
Platinum
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(-1.94)
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43.32
(+0.49)
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1933.00
(+1.50)
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Financial 15
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Resource 10
52587.29
(-0.39)
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