Cape Town - The dollar extended its weekly gain as US Treasury yields steadied, though they remained on track for the biggest one-week surge since February. Stocks struggled for traction along following a down session in Asia.
The Stoxx Europe 600 gauge edged higher while US equity-index futures nudged lower. UK shares outperformed as the pound weakened after Bank of England (BoE) Governor Mark Carney dampened expectations for a rate hike next month, and there were also reports of disagreements in Brexit talks on the Irish border.
Treasury yields held above 2.9% as German bunds steadied. UK gilts reversed a decline to pare some of yesterday’s slump as traders slashed bets on a May rate hike by the BoE.
Meanwhile, WTI crude extended its advance to a three-year high, but the rally in metals market stuttered, driving the Bloomberg Commodity Index lower for a second day.
While investors debate the cause of the decline in sovereign debt, bond market gauges showed an increase in expectations for US inflation after the recent torrid gains in metals from aluminum to nickel. Trade remains in focus with the US Treasury Department considering using an emergency law to curb Chinese investments in sensitive technologies.
Elsewhere, the Indian rupee weakened to the lowest level since March 2017 despite minutes from the country’s central bank meeting showing an unexpected hawkish tilt. Oil prices drifted.
Here are the main moves in markets:
• The Stoxx Europe 600 Index dipped 0.1% as of 11:57.
• The UK's FTSE 100 Index jumped 0.4% to the highest in 11 weeks.
• Germany’s DAX Index fell less than 0.05%.
• France’s CAC 40 Index gained 0.1%.
• Futures on the S&P 500 Index decreased less than 0.05%.
• The MSCI Asia Pacific Index dipped 0.7%.
• Japan’s Topix index added less than 0.1%, Hong Kong’s Hang Seng Index fell 0.7%, South Korea’s Kospi declined 0.4%, Australia’s S&P/ASX 200 Index dropped 0.2%.
• The Bloomberg Dollar Spot Index increased 0.3% to the highest in more than two weeks.
• The euro dipped 0.4% to $1.2297, the weakest in two weeks.
• The British pound fell 0.2% to $1.4065, the weakest in more than two weeks.
• The Japanese yen fell 0.3% to ¥107.67 per dollar, the weakest in almost two months.
• The yield on 10-year Treasuries advanced less than one basis point to 2.91%, reaching the highest in eight weeks.
• Germany’s 10-year yield decreased one basis point to 0.59%.
• Britain’s 10-year yield dipped three basis points to 1.5%, the largest decrease in more than three weeks.
• Japan’s 10-year yield jumped two basis points to 0.06%, the highest in seven weeks.
• West Texas Intermediate crude climbed 0.3% to $68.50 a barrel, the highest in more than three years.
• Gold fell 0.4% to $1 340.28 an ounce, the weakest in more than a week on the largest fall in more than a week.
• LME copper fell 0.1% to $6 978.00 per metric ton.* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER