Investors got a reprieve from the rout in stocks and the worst volatility spike since 2015, with equities advancing in Europe and Asia. The dollar fell on concern President Donald Trump’s budget proposal will drop a Republican Party goal to balance the budget in 10 years.
In Dublin, the Iseq was up almost 100 points at 9am, while the Stocks Europe 600 index climbed on gains in miners and chemical makers. South Korean equities advanced after President Moon Jae-in was invited by North Korean leader Kim Jong Un to meet. S&P 500 futures rose. The dollar’s decline supported commodities, with metals higher and crude oil halting a six-day selloff. Japan is closed for a holiday.
Traders however remain on edge following tumultuous moves in equities last week, which saw the S&P 500 post its worst week in two years with a 5.2 percent decline on fears over interest rate hikes. The Cboe Volatility Index ended almost three times higher than its late-January level when the turbulence erupted.
Investors are awaiting US consumer-price data on Wednesday with some trepidation. Pressure on equities has been emanating from the Treasury market. Ten-year Treasury yields climbed on Monday, touching a fresh four-year high amid concern the Federal Reserve may accelerate its rate-hike schedule.
Asian stocks were buoyed by the attempts to thaw the tensions on the Korean Peninsula. Vice President Mike Pence told the Washington Post the US is readyto engage in talks about North Korea’s nuclear program, signaling a shift in policy. These comments came after Un used his sister to invite South Korea’s president for talks as the Winter Olympic Games got under way. The won outperformed major currencies.
BloombergTags: Business, Markets