NEW YORK (Reuters) – Global equity benchmarks slipped and stalled as US government shares rebounded in US technology stocks after the European Equity Bank left its stimulus program unchanged and a stimulus bill failed in the US Senate.
Gauge of MSCI shares worldwide .MIWD00000PUS Shedding 1.06% after a slight decline in Europe and a rise in Asia.
On Wall Street, the Dow Jones Industrial Average .DJI Fell 406.02 points or 1.45% to 27,534.45, S&P 500 .SPX 60 points, or 1.77%, 3,338.96 and lost to Nasdaq Composite .IXIC Fell 221.97 points or 1.99% to 10,919.59.
The ECB’s decision not to thwart its stimulus program boosted the euro, which has gained more than 8% against the dollar since spring, and more than 4% against a basket of currencies weighted by Blaak’s foreign trade.
Dollar index = USD Rose 0.159% with the euro Euro = 0.1% to $ 1.1814.
Economists said the ECB would have to take more action to support its economy, possibly in December.
“But by opposing calls for a cut in interest rates in the negative zone, the bank has consolidated the euro’s appeal to global investors. It now dares not allow the euro to rise for fear of hindering the recovery of export-dependent economies like Germany.
In the United States, initial claims for state unemployment benefits came in slightly above expectations and ended the week totaling a seasonally adjusted 884,000. 5. The number of applications received in the prior week was matched, as furloughs continued for layoffs and industries.
The US Senate on Thursday executed a Republican bill that would have provided nearly $ 300 billion in new coronovirus aid, as Democrats blocked it from moving forward, demanding more money. The measure’s failure left the future of any additional coronavirus assistance in doubt ahead of the presidential election to be held in November.
The head of Mizuho Bank, head of economics and strategy in Singapore, Vishnu Varathan, said investors were concerned about whether the US tech sell-off ended this month, and beyond that an increasingly uncertain US political outlook and persistent China American Stress.
“It is too soon to say whether this route is over or last night’s recovery is just a pause,” ANZ analysts said in a note on Thursday, referring to the equity rebound on Wednesday.
In a sign of an uncertain day in the markets, safe-haven assets such as US government bonds reversed course and rallied in US passes.
Benchmark 10 year note US10YT = RR The final price rose 6/32, 0.6837%, to yield 0.6837% late on Wednesday.
Concern about fuel demand also kept oil prices under pressure, a sign of undermining confidence in global growth. [O/R]
US crude CLc1 Recently fell 2.37% to $ 37.15 per barrel and Brent LCOc1 At $ 39.79, down 2.45% on the day.
Reporting by David Randall; Editing by Will Dunham, Steve Orlofsky, Dan Grebler and Cynthia Osterman