PlusMarkets Analysis • June 9, 2021
World stock prices held near record highs on Wednesday, while U.S. bond yields flirted with their lowest levels in a month, as investors bet the Federal Reserve is some way off from tapering its economic stimulus.
MSCI’s all-country world index last stood at 716.55, after hitting an intraday high of 718.19 on Tuesday, led by gains in Europe.
European stocks are expected to open almost flat, with Euro Stoxx futures up 0.1% and Britain’s FTSE futures down 0.1% in early trade. In Asia, the MSCI’s broadest index of Asia-Pacific shares outside Japan ticked down 0.20% and Japan’s Nikkei average shed 0.28%.
On Wall Street on Tuesday, the S&P500 was steady and near its record high.
Oil prices rose for a second session on Wednesday on signs of strong fuel demand in western economies, while the prospect of Iranian supplies returning faded as the U.S. secretary of state said sanctions against Tehran were unlikely to be lifted.
Brent crude futures were up 32 cents, or 0.4%, at $72.54 a barrel at 0640 GMT, having earlier touched $72.83, the highest since May 20, 2019. Brent rose 1% on Tuesday.
U.S. West Texas Intermediate (WTI) crude futures climbed 31 cents, or 0.4%, to $70.36 a barrel, after rising to as high as $70.62, highest since Oct. 17, 2018. WTI prices climbed 1.2% on Tuesday.
“Improved demand outlook appears to be bolstering crude oil prices, as the successful vaccine rollouts and summer driving season in the United States and Europe continues to support fuel demand,” said Margaret Yang, a strategist at Singapore-based DailyFX.
Gold was up on Wednesday morning in Asia as investors digested mixed inflation data from China and waited for similar data from the U.S. on Thursday.
Gold futures edged up 0.12% to $1,896.65 by 10:11 AM ET (5:11 AM GMT). The dollar, which usually moves inversely to gold, inched up while the benchmark 10 year U.S. Treasury yields fell to their lowest in more than a month.
Data released earlier in the day showed that the Chinese consumer price index (CPI) for May contracted 0.2% month-on-month and increased 1.3% year-on-year. However, the producer price index (PPI) jumped 9% year-on-year, exceeding expectations.
Elsewhere in Asia, South Korea’s unemployment rate rose 3.8% in May, slightly higher than April’s 3.7% growth.
In the U.S., JOLTs job openings in April increased to 9.286 million, higher than both the 8.3 million figures in forecasts prepared by Investing.com and March’s 8.288 million.
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