Stocks climb, shaking off U.S. jobs data, thanks to China trade relief
By Imani Moise and Marc Jones NEW YORK/LONDON (Reuters) - World shares rose on Thursday after Chinese exports proved far stronger than expected, suggesting a recovery was under way, but the dollar fell from two-week highs as another report showed millions of more Americans were unemployed. Gold jumped 2% as the weak U.S.
By Imani Moise and Marc Jones
NEW YORK/LONDON (Reuters) - World shares rose on Thursday after Chinese exports proved far stronger than expected, suggesting a recovery was under way, but the dollar fell from two-week highs as another report showed millions of more Americans were unemployed.
Gold jumped 2% as the weak U.S. economic data heightened fears over a coronovirus-induced global downturn.
Initial U.S. jobless claims for state unemployment benefits totalled a seasonally adjusted 3.169 million for the week ended May 2, down from a revised 3.846 million in the prior week, the Labor Department's weekly jobless claims report showed.
The data reinforced economists' expectations of a protracted recovery for the U.S. economy, which is reeling from nationwide lockdowns to slow the spread of the coronavirus pandemic.
"The pace is slowing down, which is providing some optimism that we are finally going to see things bottom out," said Ed Moya, senior market analyst at OANDA, referring to unemployment claims.
Investors took heart on news that Moderna Inc
"The more vaccine trials that are out there, the more optimism that one will stick," Moya said.
Stocks globally were bolstered by Beijing reporting a 3.5% rise in exports in April from a year earlier, confounding expectations of a 15.1% fall and outweighing a 14.2% drop in imports.
The unexpected strong showing boosted speculation China could recover from its coronavirus lockdown quicker than expected and support global growth in the process.
The Dow Jones Industrial Average <.DJI> rose 250.55 points, or 1.06%, to 23,915.19, the S&P 500 <.SPX> gained 37.37 points, or 1.31%, to 2,885.79 and the Nasdaq Composite <.IXIC> added 131.94 points, or 1.49%, to 8,986.33.
MSCI's gauge of stocks across the globe <.MIWD00000PUS> gained 1.02%.
"It's clear that this virus has gone from east to west and we are now seeing that in the data," said Societe Generale's Kit Juckes, pointing to the China numbers and relatively better purchasing managing data in countries such as Australia.
But with the full economic impact of the novel coronavirus pandemic still to be seen and huge amounts of debt potentially pushing up borrowing costs, "the market is hugely split between die-hard bears and buy-on-dip buyers", he added.
Markets traded cautiously overnight with renewed Sino-U.S. tensions lurking in the background.
U.S. President Donald Trump said he would be able to report in about a week or two whether China is meeting its obligations under a trade deal, as Washington weighed punitive action against Beijing over its handling of the coronavirus outbreak.
The flow of economic data remained grim, with the Bank of England warning that the coronavirus crisis could cause the country's biggest economic slump in 300 years.
"Despite their dizzying rally, we continue to be cautious on equities in the near term," Luca Paolini, chief strategist at asset manager Pictet said. "Markets seem to be overestimating the speed of economic recovery."
(GRAPHIC: Stocks and oil lift out of coronavirus slump - https://fingfx.thomsonreuters.com/gfx/mkt/oakpezodrvr/Pasted%20image%201588680483971.png)
WORLD'S BIGGEST BORROWER
Bond markets saw one of the largest shifts in a while after the U.S. Treasury said it would borrow $2.999 trillion during the June quarter, five times more than the previous single-quarter record.
It will sell $96 billion next week alone and a surprising amount of that will be at longer tenors, which in turn pushed up long-term yields and steepened the curve.
The 30-year bond
The early rise in Italy's yields to over 2% reflected worries caused by a German court ruling this week targeting the European Central Bank's bond purchase programme.
The U.S. dollar fell from two-week highs as investors booked profits on the currency's gains this week before Friday's U.S. nonfarm payrolls report for April, which could show massive job losses amid a COVID-19 pandemic that has ravaged the global economy. The dollar index <=USD> fell 0.291%, with the euro
In commodity markets, gold
Oil prices fell after being up more than 6% during Thursday trading as global demand worries offset bullish news that Saudi Arabia increased its official crude selling price and a surprise rise in Chinese exports last month.
(GRAPHIC: Turkey eroding financial buffer - https://fingfx.thomsonreuters.com/gfx/editorcharts/bdwpkrdbrvm/eikon.png)
(Additional reporting by Wayne Cole in Sydney; Editing by Bernadette Baum and Nick Zieminski)
This story has not been edited by Firstpost staff and is generated by auto-feed.
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.