World Stocks Catch Breath After Vaccine Euphoria
Global shares were little changed and oil rose on Wednesday as weak U.S. retail sales and a surge of new coronavirus cases dampened but did not extinguish the euphoria from recent COVID19 vaccine breakthroughs.
- Last Updated: November 18, 2020, 14:54 IST
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LONDON/TOKYO: Global shares were little changed and oil rose on Wednesday as weak U.S. retail sales and a surge of new coronavirus cases dampened but did not extinguish the euphoria from recent COVID-19 vaccine breakthroughs.
The MSCI World index was flat at 0823 GMT, just shy of the previous session’s record high.
Elsewhere in Asia, the picture was more mixed. MSCI’s broadest gauge of regional shares rose 0.6%, helped by better handling of the pandemic in much of the region and the prospect of more stimulus in China.
“Overall, the picture for investors is brighter, but the recovery is likely to be uneven,” said Cormac Weldon, Head of U.S. Equities at UK asset manager Artemis.
“Low inventories and the need to manufacture and distribute goods are likely to be the first drivers of the recovery, with the re-emergence of consumer demand adding a powerful second phase.”
The market caution was reflected in other risk markets, with U.S. crude futures up just 0.1%. Brent crude futures were up 0.4%.
“Yields continue to grind lower as more warning signs flash about the near-term outlook,” said Benjamin Schroeder, senior rates strategist at ING.
“Euro zone spreads appear to have eyes only for QE (quantitative easing), shrugging off volatility and EU setbacks,” he said, referring to news this week that Hungary and Poland have blocked the adoption of the 2021-2027 budget and recovery fund by European Union governments.
The retail sales report released by the U.S. Commerce Department showed spending decelerating as the holiday shopping season approached, amid a lack of fresh fiscal relief from Washington.
“We’re are coming out of a solid two weeks, so the market being down half a percent isn’t that bad with the prospect of COVID lockdowns,” said Jamie Cox, managing partner for Harris Financial Group.
Against a basket of currencies, the dollar fell to 92.250, its lowest since Nov. 9.
(Editing by Kim Coghill, Larry King)
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