|
 Upbeat data from major economies this week and signs of a rebound in
a range of commodities have helped restore some calm to global
markets after a turbulent start to the year.
Growth in Germany's private sector slid to a five-month low in
February but remained solid, underpinned by growing services, a
survey showed on Thursday.
MSCI's world equity index rose to its highest level in two months,
the pan-European FTSEurofirst 300 stock index dipped 0.3 percent but
held within sight of Wednesday's one-month peak.
U.S. stock futures meanwhile pointed to a largely unchanged start
for Wall Street shares.
That followed a strong session in Asia, where MSCI's broadest index
of Asia-Pacific shares outside Japan added another 1.1 percent to
reach a two-month peak.
"For markets to continue to move higher, more good data - especially
out of the U.S. - will be needed," said Markus Huber, a trader at
City of London Markets.
Focus turned to the U.S. non-manufacturing ISM report due at 1500
GMT (1000 ET), with investors eyeing the employment component for
clues about Friday's non-farm payrolls report.
A solid jobs report could bolster expectations that the Federal
Reserve remains on track to raise interest rates this year.
Data on Wednesday showed U.S. private-sector jobs rising a
surprisingly strong 214,000 in February, adding to speculation that
the payrolls report would also be upbeat.
OIL DIPS, COPPER FIRM
Oil prices eased after ballooning U.S. crude inventories and a lack
of any fresh action from the world's largest producer to temper
supply snuffed out some of the bullish sentiment that has built this
week.
Brent crude prices <LCOc1> slipped 0.2 percent to $36.86 but are
still some 35 percent above last month's lows. U.S. crude futures
were marginally higher at $34.68 <CLc1>. They have risen more than a
third since Feb. 11, when prices dropped to levels not seen since
2003 at just over $26 a barrel.
Copper prices hit their highest in more than three months, boosted
by higher equities and some confidence in global growth prospects.
Risk appetite also remained strong in currency markets, with the
Australian dollar hitting a two-month high and the safe-haven yen
ceding ground to the U.S. dollar and the euro.
The dollar was up 0.5 percent at 114 yen, moving towards the
previous day's two-week high of 114.56. Even the low-yielding euro
was up 0.6 percent at 123.95 yen.
[to top of second column] |
"We are seeing better risk appetite weighing on the yen," said Niels
Christensen, FX strategist at Nordea. "The focus is on the ISM
report, and if, like the manufacturing survey, it is a good one,
then we could see the dollar move higher."
The Australian dollar was up 0.5 percent at $0.7338 its highest
level against the dollar since early December. Data showed
Australia's fourth-quarter economic growth unexpectedly picked up to
an annual 3.0 percent.
The improved tone towards risk assets was also reflected in emerging
markets, where stocks rose for the fifth straight day -- their
longest winning streak so far this year.
CALM BUT CAUTIOUS
The calmer mood in world markets showed in the CBOE Volatility
index, a measure of investor anxiety, which closed at its
lowest level so far this year.
Against this backdrop, U.S. Treasury and German Bund yields have
pulled away from lows hit in February as greater risk appetite
lessens the appeal of safe-haven bonds.
Yet fissures remain in the global outlook, with the European Central
Bank likely to ease monetary policy further when it meets next week.
"The overriding economic concerns that were vexing investors at the
end of last year are still here - concerns about a weaker Chinese
economy, for instance," said Michael Hewson, chief markets analyst
at CMC Markets in London. "That makes me cautious about the rebound
in stock markets."
(Additional reporting by Danilo Masoni, Amanda Cooper and Anirban
Nag; Editing by Hugh Lawson)
[© 2016 Thomson Reuters. All rights
reserved.] Copyright 2016 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
