Global Markets Edge Higher as U.S. Futures Slip
June 02 2020 - 2:34AM
Dow Jones News
By Xie Yu
International markets made small gains, while U.S. stock futures
declined, as investors weighed signs of economic recovery against
risks stemming from U.S.-China tensions, the new coronavirus and
social unrest in the U.S.
By early afternoon Tuesday in Hong Kong, the city's Hang Seng
Index and stock benchmarks in Japan and South Korea had all risen
0.5% to 1.5%. China's Shanghai Composite added 0.1%, and
Australia's S&P/ASX 200 rose 0.3%.
E-mini S&P 500 futures lost 0.2%.
"The equity market has been pricing in a smooth recovery of the
economy, although it might be too optimistic while overlooking some
potential risks," said Anthony Chan, chief Asia investment
strategist at Union Bancaire Privée.
Among other risks, Mr. Chan cited the possibility of fresh
coronavirus outbreaks, bringing new lockdowns, and a fragile
geopolitical backdrop. He said the Trump administration could take
more-severe measures related to Hong Kong ahead of the U.S.
presidential election in November.
In currency markets, the Australian dollar continued to recover
from the troughs it hit in mid-March, buying more than 68 U.S.
cents for the first time since late January. It stood at 68.05 U.S.
cents by early afternoon Hong Kong time.
On Tuesday, the Reserve Bank of Australia left its benchmark
interest rate unchanged at 0.25%. Gov. Philip Lowe said the
country's downturn could be shallower than expected, although the
outlook remained highly uncertain. The central bank's board didn't
discuss negative interest rates at its meeting.
The U.S. dollar has slid in recent sessions, and riskier
currencies such as the Mexican peso have strengthened, on optimism
about economic recovery. On Tuesday morning in Hong Kong, the WSJ
Dollar Index, which measures the U.S. currency against 16 others,
was fractionally stronger at 92.06. It peaked above 97 in
March.
U.S. indexes rose Monday as investors embraced signs that global
factory activity was on a path toward recovery and largely shrugged
off violent protests in U.S. cities.
In bond markets, the yield on the 10-year U.S. Treasury note
eased to 0.658%, according to Tradeweb, down from 0.662% on
Monday.
Brent crude, the global oil benchmark, gained 1.1% to $38.74 a
barrel.
An alliance of oil-producing nations led by Saudi Arabia and
Russia is close to a deal that would extend their collective
production cuts through Sept. 1.
Write to Xie Yu at Yu.Xie@wsj.com
(END) Dow Jones Newswires
June 02, 2020 02:19 ET (06:19 GMT)
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