Stocks, Futures Rally in Positive Sign for U.S. Markets
April 06 2020 - 3:29AM
Dow Jones News
By Xie Yu
Global markets rose on Monday, with several stock indexes in the
Asia-Pacific region adding more than 4% and S&P 500 futures
rising, suggesting U.S. markets could also gain ground later in the
day.
Australia's benchmark S&P/ASX 200 index gained 4.3%. Japan's
Nikkei 225 rose 4.2%, and South Korea's Kospi Composite advanced
3.3%. Hong Kong's benchmark Hang Seng Index was up 1.7% in
midafternoon trade.
E-mini S&P 500 futures rose 3.8%. The yield on the 10-year
U.S. Treasury note rose to 0.627%, up from 0.587% on Friday. Yields
move in the opposite direction from bond prices.
On Sunday, New York reported its first one-day decline in deaths
caused by the new coronavirus, although Gov. Andrew Cuomo said it
was too early to understand the significance of that number. New
York is the U.S. state with the most confirmed cases.
Some daily death tolls for Covid-19, the respiratory disease
caused by the coronavirus, fell in Western Europe, with Italy
reporting the fewest deaths in more than two weeks. France reported
the lowest number in five days and Spain's tally fell for three
days in a row.
"A sense of eagerness to see a turn in the spread of the virus
and economic growth is driving the market today," said Govinda
Finn, an economist at Aberdeen Standard Investments. However, Mr.
Finn added: "I wouldn't have massive confidence that we are there
yet, so I think the rally probably won't last long."
Brent crude, the global oil benchmark, fell steeply in early
trade before rebounding 0.2% to $34.16.
The Saudi-led Organization of the Petroleum Exporting Countries
will convene a virtual meeting on Thursday with other oil-producing
nations including Canada and Russia, aiming to negotiate a truce in
a Saudi-Russia fight for market share that has cratered oil prices
over the past month.
President Trump threatened to impose tariffs on oil imports if
Russia and Saudi Arabia couldn't resolve their differences.
Dwyfor Evans, head of macro strategy for Asia Pacific at State
Street Global Markets in Hong Kong, said several factors were
slowly improving market sentiment.
He said these included a possible oil deal, global stimulus
packages, and signs that lockdowns in the U.S. and Europe were
helping slow the spread of the coronavirus pandemic.
However, he said volatility remained high and cross-asset
correlations, or typical relationships between prices of different
assets, had broken down, suggesting the market was still under
stress. "We have good days and bad days. Sometimes they follow each
other," he said.
Markets in mainland China were closed for a holiday.
Major U.S. indexes registered modest declines last week, while
bonds continued to rally. The yield on the 10-year U.S. Treasury
note fell for a third straight week, as investors rushed into safer
assets.
Write to Xie Yu at Yu.Xie@wsj.com
(END) Dow Jones Newswires
April 06, 2020 03:14 ET (07:14 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.