Connect with us


US stocks surge the most since June 2020 | Financial Markets News – Al Jazeera English



Global stocks staged a ferocious rebound from the war-induced rout, with European equities notching the biggest rally since the pandemic bottom in March 2020 and U.S. shares jumping the most intraday since November of that year. Oil sank more than 10% and Treasuries dropped.

Dip buyers powered the S&P 500 up almost 3% and Germany’s DAX Index to an eye-popping 7.9% surge on speculation that two weeks of selling amply reflected the global economic impact of escalating sanctions on Russia. Oil slid below $110 a barrel in New York and the 10-year Treasury yield climbed back above 1.9%.

Still, the rallies managed to claw back only some of the losses incurred since Russia invaded Ukraine. The DAX had plunged into a bear market earlier this week, while the S&P 500 is still sitting 10% below where it started the year. West Texas crude has added almost $20 a barrel in two weeks, and other commodities from nickel to wheat remain near historically high prices.

The risk-on rally is the latest wild ride for markets have been roiled by fears of a global inflation shock from a commodity-price rally fueled by Russia’s isolation, while supply disruptions threaten to usher in a period of slower global growth. Sentiment was lifted Wednesday after a top foreign policy aide to Ukrainian President Volodymyr Zelenskiy said the country is open to discussing Russia’s demand of neutrality as long as it’s given security guarantees.

“Risk markets are higher today, suggesting traders are no longer in flight mode and are starting to think about value again,” said Chris Low, chief economist at FHN Financial. “That doesn’t mean volatility is over. Economic consequences, macro and micro, are still in flux. The West is still working on sanctions for Russian energy, and the duration and outcome of the war is still a big unknown.”

The rally in U.S. stocks Wednesday comes on the 13th anniversary since the S&P 500 bottomed out following the financial crisis. The gauge has climbed more than 500% in this bull market, with an annual return of about 15%.

The S&P 500 is up 532% since bottoming out after the financial crisis

Russian forces intensified their bombardment of Ukraine’s capital Kyiv, the U.S. said. The Russian stock market’s trading halt is being extended in an effort to keep prices from tumbling in the wake of vast international sanctions.

Meanwhile, Coca-Cola Co. joined McDonald’s Corp., Starbucks Corp. and a host of other companies in suspending Russia operations in protest at the war. Fitch Ratings cut Russia’s credit rating and said a bond default is “imminent.”

Oil tumbled as the U.A.E. and Iraq signaled OPEC may have greater willingness to raise output. Crude has posted huge intraday swings in recent days as Russia’s invasion of Ukraine threatens a major global supply shock. Declines in crude and gas Wednesday are reversing some of the main trades seen since war broke out.

“What we’re seeing today is a lot of focus on commodity prices,” Michelle Cluver, associate portfolio strategist at Global X, said in a phone interview. “We are also seeing, especially with what’s happened with banning energy imports from Russia, the question about economic growth increasingly coming to the forefront.”

Enormous Loss

Commodity costs underline the inflation challenge and growth dilemma facing central banks. The European Central Bank meeting Thursday may reflect caution as the war on Ukraine has upended the continent’s economic outlook, while bets on a Federal Reserve rate hike have been scaled back over the past few weeks, with a quarter point now widely expected. Still, with U.S. inflation data due Thursday set to capture prewar prices, economists are now saying it could peak somewhere in the 8%-9% range this month or next.

Commodities broadly pulled back from highs, with gold dropping from a 19-month high on improved risk sentiment. Bullion is still up 9% this year as investors seek a hedge against the threat of an inflationary shock.

In cryptocurrencies, Bitcoin jumped above $42,000 amid a sharp rally in digital tokens, spurred by optimism about an impending U.S. overhaul of crypto oversight that Treasury Secretary Janet Yellen called “historic.”

For more markets news, follow our Markets Live blog.

Here are some key events this week:

  • European Central Bank President Christine Lagarde briefing after policy meeting, Thursday
  • U.S. CPI, initial jobless claims, Thursday

Some of the main moves in markets:


  • The S&P 500 rose 2.9% as of 3:25 p.m. New York time
  • The Nasdaq 100 rose 3.8%
  • The Dow Jones Industrial Average rose 2.3%
  • The MSCI World index rose 2.9%


  • The Bloomberg Dollar Spot Index fell 1%
  • The euro rose 1.6% to $1.1074
  • The British pound rose 0.6% to $1.3185
  • The Japanese yen fell 0.1% to 115.81 per dollar


  • The yield on 10-year Treasuries advanced eight basis points to 1.93%
  • Germany’s 10-year yield advanced 10 basis points to 0.22%
  • Britain’s 10-year yield advanced eight basis points to 1.53%


  • West Texas Intermediate crude fell 11% to $109.65 a barrel
  • Gold futures fell 2.3% to $1,996.30 an ounce–With assistance from Akshay Chinchalkar, Sharon Cho, Andreea Papuc, Srinivasan Sivabalan and Peyton Forte.

Adblock test (Why?)

Source link

Continue Reading


World shares sink after inflation driven retreat on Wall St – Business News –



Shares declined in Europe and Asia on Thursday after a broad retreat on Wall Street triggered by worries over the impact of persistent high inflation on corporate profits and consumer spending.

U.S. futures were lower, while oil prices advanced.

Germany’s DAX lost 2% to 13,731.64 and the CAC 40 in Paris declined 1.9% to 6,234.78. Britain’s FTSE 100 shed 1.7% to 3,537.99. The future for the S&P 500 was 1% lower while the future for the Dow Jones Industrial Average sank 0.9%.

The Dow industrials sank more than 1,100 points, or 3.6% on Wednesday, and the S&P 500 had its biggest drop in nearly two years, shedding 4%. That was its steepest decline since June 2020. The tech-heavy Nasdaq fell 4.7%.

The benchmark index is now down more than 18% from the record high it reached at the beginning of the year. That’s just shy of the 20% decline that’s considered a bear market.

“The sentiment in the market is highly negative as traders and investors are largely concerned about an economic downturn and soaring inflation,” Naeem Aslam of Avatrade said in a commentary.

The Federal Reserve is trying to temper the impact from the highest inflation in four decades by raising interest rates. Many other central banks are on a similar track. But the Bank of Japan has stuck to its low interest rate policy and the gap between those benchmark rates of the world’s largest and third-largest economies has pushed the dollar’s value up against the Japanese yen.

Japan reported a trade deficit for April as its imports ballooned 28%. The shift reflects surging energy costs amid the war in Ukraine and a weakening of the yen against the U.S. dollar.

Japan’s exports grew to 8.076 trillion yen ($63 billion) last month, up 12.5% from the previous year, according to Ministry of Finance data released Thursday. Imports totaled 8.915 trillion yen ($70 billion) in April, up from 6.953 trillion yen in April 2021, and the highest since comparable numbers began to be taken in 1979.

The Nikkei 225 in Tokyo lost 1.9% to 26,402.84 and the Hang Seng in Hong Kong dropped 2.5% to 20,120.60. In South Korea, the Kospi shed 1.3% to 2,592.34, while Australia’s S&P/ASX 200 gave up 1.7% to 7,064.50.

The Shanghai Composite index reversed earlier losses, gaining 0.4% to 3.096.96.

On Wednesday, retailer Target lost a quarter of its value after reporting earnings that fell far short of analysts’ forecasts. Inflation, especially for shipping costs, dragged its operating margin for the first quarter to 5.3%. It had been expecting 8% or higher.

The company warned that its costs for freight this year would be $1 billion higher than it estimated just three months ago.

The report comes a day after Walmart said its profit took a hit from higher costs. The nation’s largest retailer fell 6.8%, adding to its losses from Tuesday.

Target and Walmart each provided anecdotal evidence that inflation is weighing on consumers, saying they held back on purchasing big-ticket items and changed from national brands to less expensive store brands.

The weak reports stoked concerns that stubbornly rising inflation is putting a tighter squeeze on a wide range of businesses and could cut deeper into their profits.

Other big retailers also have racked up hefty losses.

The data are not entirely consistent. On Tuesday, the market cheered an encouraging report from the Commerce Department that showed retail sales rose in April, driven by higher sales of cars, electronics, and more spending at restaurants.

Investors worry the Fed could trigger a recession if it raises interest rates too high or too quickly. Worries persist about global growth as Russia’s invasion of Ukraine puts even more pressure on prices for oil and food while lockdowns in China to stem COVID-19 cases worsens supply chain problems.

In other trading, benchmark U.S. crude oil rose 56 cents to $110.15 per barrel in electronic trading on the New York Mercantile Exchange. It dropped $2.81 to $109.59 on Wednesday.

Brent crude, the basis for pricing for international trading, climbed $1.19 to $110.30 per barrel.

The dollar fell to 128.14 Japanese yen from 128.20 yen late Wednesday. The euro strengthened to $1.0481 from $1.0464.

Adblock test (Why?)

Source link

Continue Reading


Gold prices holding at session highs as U.S. existing home sales fall 2.4% in April – Kitco NEWS



Editor’s Note: With so much market volatility, stay on top of daily news! Get caught up in minutes with our speedy summary of today’s must-read news and expert opinions. Sign up here!

(Kitco News) – The gold market continues to trade near session highs, supported by more disappointing economic data. Rising interest rates continue to cool down the U.S. housing market as fewer consumers purchased home last month, according to the latest data from the National Association of Realtors (NAR).

Existing home sales fell to a seasonally adjusted and annualized rate of 5.61 million units last month, down 2.4% compared to March’s annualized rate of 5.75 million homes, the NAR said on Thursday. Market consensus projections called for existing home sales to fall only slightly to 5.65 million.

For the year, home sales are down 5.9%, the report said.

The gold market has seen some renewed technical buying momentum, which has been supported by weaker-than-expected economic data. June gold futures last traded at $1,842.40 an ounce, up nearly 1.5% on the day.

The U.S. housing sector has faced some challenging headwinds as the Federal Reserve looks to aggressively raise interest rates, which in turn is pushing mortgage rates higher.

“Higher home prices and sharply higher mortgage rates have reduced buyer activity,” said Lawrence Yun, NAR’s chief economist. “It looks like more declines are imminent in the upcoming months, and we’ll likely return to the pre-pandemic home sales activity after the remarkable surge over the past two years.”

Yun noted that the falling sales space is helping to boost the supply of existing homes. The report said that the inventory of homes for sale totaled 1,030,000 in April, representing a 2.2-month supply.

Although sales are down, Yun said that home prices still remain elevated.

“The market is quite unusual as sales are coming down, but listed homes are still selling swiftly, and home prices are much higher than a year ago,” he said.

The report said the median existing-home price for all housing types in April was $391,200, up 14.8% from April 2021.

Adblock test (Why?)

Source link

Continue Reading


Ford recalling 350,000 SUVs due to unexplained engine fires, including some sold in Canada – CBC News



Ford is asking the owners of 350,000 SUVs from the 2021 model year to take them to dealers for repairs because the engines can catch fire.

Ford says in U.S. government documents posted Thursday that it doesn’t know what’s causing fires in some Ford Expedition and Lincoln Navigator SUVs from the 2021 model year.

2863 of the vehicles were sold in Canada: 2,354 Expeditions, and 509 Navigators.

Owners are being advised to park them outside if possible because engine fires have been reported even when the vehicles were not in use.

Ford has reports of 16 fires under the hood, 12 of which started when the engine was off. One person was burned.

Trying to notify customers

So far it hasn’t developed a repair for the fires, which appear to start at the back of the engine compartment on the passenger side.

Ford says it’s treating the recall urgently and will use apps and mail to notify customers as soon as it develops a list of vehicle owners and addresses.

“We are working around the clock to determine the root cause of this issue and subsequent remedy so that customers can continue to enjoy using their vehicles,” Jeffrey Marentic, general manager of Ford passenger vehicles, said in a statement.

Ford began investigating fire reports on March 24. It says the fires appear to be limited to SUVs built from Dec. 1, 2020 to April 30, 2021. The company says it has no fire reports from vehicles built before or after those dates.

Adblock test (Why?)

Source link

Continue Reading