World shares rebound, Americans try to intimidate tech route

TOKYO (Reuters) – US stock futures and Asian stocks gained a few notches after a small surge in European stocks on Tuesday as investors felt that high-flying US tech stocks could recover from their recent stance.

FILE PHOTO: A man wearing a protective face mask walks in front of a stock quotation board outside a brokerage in Tokyo, Japan, March 10, 2020, after an outbreak of coronovirus disease (COVID-19). REVS / Stoyan Nenov / File photo

MSCI’s largest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 0.2% while Japan’s Nikkei .N225 rose 0.4%. US financial markets closed for a public holiday on Monday while Europe’s STOXX 600 index was up 1.7%.

Globally, US S&P 500 futures ESCv1 traded, erasing its Monday loss to trade 0.6% higher. While tech stocks remained more fragile, Nasdaq futures NQcv1 stood flat, after falling more than 6% last week.

While many market players say they cannot pinpoint a single trigger for the sudden decline of the Nasdaq, the valuation has been raised after a 75% rise from the lows in March.

Tesla (TSLA.O), After it saw a drop in Euphoria’s poster child’s year-over-year earnings in large technology stocks by 400%, it appears to be excluded from the group of companies to be added to the S&P 500 having had.

It lost 6.5% after hours of trading on Friday and fell 2.7% in Frankfurt (TSLA.F) on Monday.

“Those tech stocks were getting expensive, so I would see their latest revamp as a healthy improvement,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

Risky assets are being faced, but there are suspicions that US policymakers may not be ready to compile the stimulus on a large scale as some traders had hoped.

AllianceBernstein’s portfolio manager Masahiko Lu said, “Friday’s US jobs data headline figures were very good, which may have fueled speculation not to be anxious to avoid trillions of dollars to support the economy.”

The markets have gone much further this month than the Federal Reserve announced to take a more easing step, he said, adding that there is a reason behind the surge in US bond yields last week.

The 10-month US fund yield in August was 0.716% US10YT = RR, down from a five-month low of 0.504%.

In currencies, Sterling was dropped after the European Union told Britain on Monday that there would be no trade deal if it tried to tamper with the Brexit divorce treaty.

The warning came after British Prime Minister Boris Johnson’s government reported plans to enact new legislation to override parts of the Brexit withdrawal agreement signed in January.

The pound declined 0.80% to $ 1.3167 GBP = D4 on Monday, near its lowest level in two weeks.

Other currencies rose significantly with yields helping to reduce the recent weakness of the US dollar.

The euro was slightly depreciated overnight at $ 1.1818 EUR =, while the dollar was down at 106.31 yen yen =. Gold was slightly changed at $ 1,930.9 per ounce XAU =.

Oil prices plummeted to a five-week low after Saudi Arabia cut its monthly prices to supply Asia in five months and the market recovered due to uncertainty over Chinese demand.

US WTI futures CLc1 fell 1.4% to $ 39.23 a barrel.

Reporting by Hideyuki Sano; Editing by Christopher Cushing

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