GLOBAL MARKETS-Stocks meander higher, but virus fears hold optimism in check

GLOBAL MARKETS-Stocks meander higher, but virus fears hold optimism in check

Reuters  | Jun 26, 2020 13:20

GLOBAL MARKETS-Stocks meander higher, but virus fears hold optimism in check

* Bulls grind out gains in arm wrestle
* MSCI AxJ up 0.5% for 0.7% weekly gain, Nikkei +1.3%
* Dollar steady as investors see risks balanced
* Asian stock markets:

By Tom Westbrook
SINGAPORE, June 26 (Reuters) - Asian stock markets ground
higher on Friday, but are set to end a choppy week with only
slight gains as surging coronavirus infections cast a shadow
over encouraging economic data and checked hopes for a swift
global recovery.
MSCI's broadest index of Asia-Pacific shares outside Japan
MIAPJ0000PUS rose 0.5%, for a weekly gain of around 0.7%.
Japan's Nikkei .N225 rose 1.3% to sit 0.4% higher for the
Bulls seem to have the upper hand in currency markets, with
the U.S. dollar down 0.3% for the week, and riskier currencies
such as the Australian dollar marginally ahead. FRX/
U.S. stock futures were 0.1% higher in afternoon trade in
Asia, while European futures pointed to small Thursday gains
extending. German DAX futures FDXc1 , Britain's FTSE futures
FFIc1 and EuroSTOXX 50 futures STXEc1 all rose about 1%.
"We're stuck in a bit of a range," said Shane Oliver, chief
economist at AMP Capital in Sydney. "There's a degree of
optimism that any second wave will be offset by stimulus ... but
if we have to go back to a renewed lockdown then it's a
different story, and markets face a lot more downside risk."
The moves followed a bumpy session on Wall Street, which
finished in positive territory after a late surge led by banking
stocks. NL1N2E20X2
Still, volumes were light and plenty of headwinds remain.
The governor of Texas paused the state's reopening as
COVID-19 infections and hospitalizations surged and the United
States set a new record for a one-day increase in cases.
Localised restrictions to slow the virus have now been
re-imposed in parts of Lisbon in Portugal, western Germany,
Australia's Victoria state and Beijing. Australia's biggest
grocer also reinstated buying limits on toilet paper after
another rush in stores.
The U.S. Senate also passed legislation that would impose
mandatory sanctions on people or companies that back efforts by
China to restrict Hong Kong's autonomy, yet another potential
Sino-U.S. flashpoint. To become law it must also pass the House and be signed by
President Donald Trump. Support for pro-democracy protests in
Hong Kong has slipped, but retains backing of a slim majority, a
survey conducted for Reuters showed. Hong Kong's Hang Seng index .HSI fell 0.6% in on Friday,
after being closed for a holiday on Thursday. Markets in China
and Taiwan remain closed. .HK
The U.S. Treasury market was quiet, with the yield on
benchmark 10-year Treasuries US10YT=RR steady at 0.6807%. Gold
XAU= held steady at $1,759.81 an ounce. US/ GOL/

The tug of war between bulls and bears this week has sent
the S&P 500 .SPX ahead by as far 1.8% and down by as much as
2.4% on the week, with Thursday's gains leaving it flat.
Foreign exchange markets have likewise stalled, as the
virus' progress dents confidence in bets on further gains in
hard-running riskier currencies.
"Having risen for three straight months, some payback may be
due for stocks and currencies in July," strategists at
Singapore's DBS Bank said in a note on Friday.
"We would avoid currencies – Indonesian rupiah, Australian
dollar and New Zealand dollar – that appreciated most in June
and Q2."
Moves in majors were small on Friday, with the Aussie
AUD=D3 steady at $0.6889, up 0.8% for the week, and the kiwi
NZD=D3 edging ahead to $0.6444, for a 0.6% weekly gain. The
Aussie has rallied 25% from March lows and the kiwi 18%. AUD/
After a mixed bag of U.S. data overnight, markets are
looking for reassurance from European confidence surveys and
U.S. spending data due later on Friday.
Oil prices, a barometer of energy consumption and so the
global growth outlook, edged ahead to hold steady for the week.
U.S. crude CLc1 futures were last up 1.3% or 49 cents to
$39.21 per barrel and Brent futures LCOc1 rose 1.4% to $41.62
per barrel. O/R

Global assets
Global currencies vs. dollar
Emerging markets
MSCI All Country Wolrd Index Market Cap

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