Stocks find their feet full of U.S. data to set a pre-holiday tone for Reuters

Author: Huw Jones

LONDON (Reuters) – Shares regained lost ground on Wednesday as oil prices rose as oil companies rose, but it was a day to thank investors for the rise in COVID-19 cases in Europe, weaker German economic sentiment and a bunch of US data.

The STOXX index for 600 European companies rose 0.4%, recovering from a three-week low on Tuesday due to concerns about rising infection rates in continental Europe due to blockages. Trading at about 481 points, the index is still about 10 points higher than last week’s record.

The MSCI world stock index was flat at 749 points, about 10 points higher than its highest in a lifetime a week ago.

“People are struggling to determine whether the downward movement this week was the start of a correction, just to drive a lower test or uncertainty flows,” said Mike Hewson, chief market analyst at CMC Markets.

“The big concerns are more blockages, that’s what dominates the sentiment, and what that would do for European Central Bank policy,” Hewson said.

Germany’s Ifo business sentiment index stood at 96.5 in November, compared to Reuters ’consensus forecast of 96.6.

Ifo said the decline in business morale in Europe’s largest economy is worrying, and growth is expected to stop in the fourth quarter as companies face supply chain hurdles.

Investors have a lot of data in the United States ahead of Thursday’s Thanksgiving holiday, including the PCE index, an inflation index closely watched by the Federal Reserve.

U.S. inflation has risen to a three-decade high, and the minutes of the Fed’s latest meeting will also be examined to see if the central bank will accelerate the reduction in the stimulus program to buy bonds at next month’s meeting.

“There is a risk that the Fed will accelerate the downturn, which could lead to a tightening schedule, helping to strengthen the dollar,” said Bank of Singapore currency strategist Sim Moh Siong.

UniCredit Bank told customers that investors will study the minutes to see if the divergences between pigeons and hawks are growing.

Stock markets were nervous in Asia, driven by rising U.S. Treasury yields and volatile oil prices in the face of cooling prices by the United States and other nations.

MSCI’s broadest Asia-Pacific stock index fell 0.14% outside of Japan, while the benchmark Japanese price index fell 1.6% as investors returned from vacation and caught global falls the day before. The Chinese blue chips were slightly stronger. The dollar rises as Fed rate speculation rises, https://fingfx.thomsonreuters.com/gfx/mkt/zjpqkwzyxpx/Fed.PNG

CRUDE OIL CROSS OIL SHARES OIL

Oil prices soared, extending profits from the previous session as investors remained skeptical about the effectiveness of oil releases from strategic reserves in the US, hoping to cool prices as more calls for crude demand did not affect OPEC + producers.

futures reversed early losses to $ 82.71 a barrel and futures rose 0.6% to $ 78.93 a barrel.

Stronger oil helped boost oil company shares in Europe

Overnight, yields rose by more than 5 basis points (bps) to 1.684% before falling to 1.6531%. The two-year U.S. Treasury yields fell on Monday after hitting the highest level since March 2020. [US/]

Otherwise, the money market was suspended for a breather on Wednesday as the dollar largely held on to recent gains against most of its peers as a result of rising Treasury yields.

The greenback was trading at 115.05 yen after hitting a four-and-a-half-year high of 115.22 yen.

Interest-free gold, which reacted badly to the rise in Treasury yields, was revived slightly. The last spot price of $ 1,792 was up 0.16%, but still close to a two-week low on Tuesday. [GOL/]

The New Zealand central bank raised interest rates on Wednesday for the second time in two months, driven by inflationary pressures and easing coronary virus cuts that helped economic activity.

However, with the market open for further growth, the New Zealand dollar weakened 0.45% to $ 0.619180.

The Turkish lira continued under pressure, falling 2.3% to $ 12.52 per dollar on Tuesday, when President Tayyip Erdogan defended rate cuts and vowed to win his “economic war of independence” on Tuesday.

The pound drops dramatically as the crisis picks up strength, https://graphics.reuters.com/TURKEY-LIRA/klpykdrakpg/chart_eikon.jpg