Global stocks were mixed Thursday as the number of coronavirus deaths increased and economic pain intensified, with another record week of jobless claims expected in the United States.
Investors sought the security of the US dollar, which has held on to recent gains. Oil futures surged after US President Donald Trump said he expected Saudi Arabia and Russia to quickly strike a deal to end their oil price war.
In Japan, the Nikkei index finished down 1.37%, taking its losses to 25% so far this year. European equities made provisional gains, with the pan-European STOXX 600 gaining 0.5%. Wall Street futures rose 1.8% after diving overnight.
“WE. Unemployment demands are expected to rise again and, in this environment, we cannot speak of a recovery in stocks in the short term. The best you can hope for is stabilization in the current environment, “said François Savary, chief investment officer at Swiss Partners, asset manager Prime Partners.
In Europe, oil and gas values rose, Royal Dutch Shell, Total SA and BP leaping from 4% to 9.0%, thanks to the rise in oil prices.
Brent crude futures rose 11.0%, or $ 2.72, to $ 27.46. West Texas Intermediate (WTI) crude futures rose 10.14% or $ 2.08 to $ 22.39.
Trump said he had recently spoken with leaders of Russia and Saudi Arabia and expected the two countries to reach an agreement within a few “days” to cut production and thereby drive up prices.
British Airways owner IAG’s shares rose 3.0% after someone familiar with the matter said British Airways was in talks with its union over a plan to suspend approximately 32,000 employees so that she could survive the coronavirus pandemic.
Eurozone government bond yields rose as investors cautiously returned to riskier assets. German 10-year government bond yields rose 4 basis points to -0.426%, deviating from the lows of -0.55% reached on Monday.
The yield on 10-year US Treasuries – which goes down when prices go up – has dropped to 0.5680%.
“There had been fears of the bond market exploding, but for now there is a return to normal correlation in the market, so we don’t see a vicious circle where bonds lower stocks and stocks are lowering bonds, “said Savary. .
US labor market data should provide the next test of market sentiment and pain in the world’s largest economy.
Initial claims for unemployment benefits last week likely broke the record 3.3 million the previous week, with 3.5 million expected, according to a Reuters survey of economists.
Goldman Sachs said on Thursday that he expects the number of unemployed Americans to reach a record 6 million for March 22-28.
“Unemployed claims will be the most timely real-world data point for assessing the depth of the recession and capturing the start of the recovery,” Goldman Sachs economists wrote in a note to customers.
China and South Korea have shown signs of controlling the virus, reporting a decline in the number of new cases, but progress remains fragile and infections are skyrocketing globally.
The World Health Organization has said that the number of cases worldwide will reach 1 million and the number of deaths 50,000 in the coming days. It currently stands at 46,906.
Trump, who had initially downplayed the epidemic, told reporters at the White House on Wednesday that he was considering a plan to stop theft of coronavirus hot spots in the United States.
In the foreign exchange markets, the dollar index against a basket of six major currencies remained stable at 99.625 after gaining 0.53% overnight. The euro fell 0.3% to $ 1.0934 with the appreciation of the dollar.
The British pound hit a three-week high against the euro and gained against the dollar on Thursday. It was last up 0.9% from the euro at 87.81 pence for the euro, its highest level since March 11.
The Hungarian forint won after the central bank used what analysts called an “implicit rate hike” to stop the slide of the worst-performing currency in Central Europe.
Spot gold fell 0.1% to $ 1,589.71 an ounce.