Equities, oil prices gain as Suez Canal shutdown continues

By David Randall NEW YORK (Reuters) - Global equity benchmarks and oil prices rose on Friday while safe havens such as the dollar and U.S. Treasuries dipped as hopes for a global economic recovery overshadowed the continued blockage of one of the world's most vital shipping lanes. More than 30 oil tankers are waiting to traverse the Suez Canal, which has been blocked since Wednesday after a container ship ran aground.

Reuters March 27, 2021 01:05:50 IST
Equities, oil prices gain as Suez Canal shutdown continues

Equities oil prices gain as Suez Canal shutdown continues

By David Randall

NEW YORK (Reuters) - Global equity benchmarks and oil prices rose on Friday while safe havens such as the dollar and U.S. Treasuries dipped as hopes for a global economic recovery overshadowed the continued blockage of one of the world's most vital shipping lanes.

More than 30 oil tankers are waiting to traverse the Suez Canal, which has been blocked since Wednesday after a container ship ran aground. It may take weeks to free the beached vessel, though analysts said low seasonal demand for oil may mitigate the impact of the blockade.

The dollar rose to a nine-month high against the Japanese yen of 109.44 yen, reflecting investor expectations of robust U.S. economic growth as it accelerates its vaccine rollout. Overall, the dollar index, which measures the greenback against a basket of six major currencies, fell 0.037%, with the euro up 0.2% to $1.1787.

"We left 2020 with the validation of the consensus view the dollar would weaken," said Vincent Manuel, chief investment officer at Indosuez Wealth Management.

"We have woken up in 2021 facing the reality that the U.S. is growing much quicker than Europe... so we have a massive divergence."

MSCI's gauge of stocks across the globe gained 0.50% following broad gains in Europe and Asia.

Business morale in Europe's biggest economy, Germany, is back to its best in almost two years thanks to recovering global demand for manufactured goods, data showed on Friday.

In afternoon trading on Wall Street, the Dow Jones Industrial Average rose 79.08 points, or 0.24%, to 32,698.56, the S&P 500 gained 9.64 points, or 0.25%, to 3,919.16 and the Nasdaq Composite dropped 90.20 points, or 0.7%, to 12,887.48.

Bond yields were slightly up on the day, but 10-year U.S. Treasuries were on track for their biggest weekly yield drop since June.

Benchmark 10-year notes last fell 12/32 in price to yield 1.6565%, from 1.614% late on Thursday.

Weekly money flow data from Bank of America showed global investors have been darting for safety this week amid concerns over rising coronavirus cases in Europe and the potential for global shipping to slow given the blockade of the Suez Canal. They pumped $45.6 billion into cash funds, the largest since April 2020, when COVID-19 was spreading quickly.

Turkey's markets were struggling to settle after the lira's near 10% slump triggered by President Tayyip Erdogan's latest central bank chief sacking, which has raised worries about a full-blown crisis that would require capital controls. [EMRG/FRX]

Blue chip Chinese stocks rebounded more than 2% after a three-day losing streak, which, like emerging market shares generally, had left them at the lowest level of the year.

"All the sanctions (on China) so far have been largely symbolic and should have little economic impact. But the Sino-U.S. confrontation is affecting market sentiment. It could take some time for them to come to any compromise," said Yasutada Suzuki, head of emerging market investment at Sumitomo Mitsui Bank.

U.S. crude recently rose 3.91% to $60.85 per barrel and Brent was at $64.34, up 3.86% on the day.

(Reporting by David Randall; Editing by Dan Grebler and Chizu Nomiyama)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

How Biden's agencies are picking apart Trump's Wall Street-friendly measures
Business

How Biden's agencies are picking apart Trump's Wall Street-friendly measures

(In first paragraph, fixes hyperlink to story) By Katanga Johnson WASHINGTON (Reuters) -U.S.

GM marketing spend will return to normal levels post pandemic
Business

GM marketing spend will return to normal levels post pandemic

By Ben Klayman DETROIT (Reuters) - General Motors Co's marketing and promotional spending will return to normal levels after the COVID-19 pandemic caused that budget to drop last year, the U.S. automaker's top marketing officer said on Monday. "What we went through in the pandemic was certainly severe and we should be moving back up to our normalized levels," GM Chief Marketing Officer Deborah Wahl said in an online appearance at a Reuters Events conference.

White House to zero in on chip shortage in meeting with company officials
Business

White House to zero in on chip shortage in meeting with company officials

By Nandita Bose WASHINGTON (Reuters) - U.S. President Joe Biden will urge Congress to invest $50 billion in semiconductor manufacturing and research when he meets with top executives from nearly 20 major companies on Monday about the global chips shortage that has roiled the automotive industry and technology firms. The push is part of his broader focus on rebuilding U.S