World stocks pause rally on J&J news, USD bounces from three-week low
By Koh Gui Qing NEW YORK (Reuters) - The U.S. dollar rose from a three-week low on Tuesday while shares in Europe and the United States eased, as news of a pause in Johnson & Johnson's COVID-19 vaccine trial led investors to take stock of recent rallies before chasing further gains
By Koh Gui Qing
NEW YORK (Reuters) - The U.S. dollar rose from a three-week low on Tuesday while shares in Europe and the United States eased, as news of a pause in Johnson & Johnson's COVID-19 vaccine trial led investors to take stock of recent rallies before chasing further gains.
Some analysts said Tuesday's pullback in stock markets was not indicative of a deeper aversion to risk, given that many investors are convinced that there is more fiscal stimulus to come in the United States.
Still, the dip in stock markets was accompanied by firmer demand for traditional safe-haven assets such as the dollar and government bonds. A stronger dollar in turn weighed on gold prices.
Trade data from China released overnight that suggested the world's second-largest economy was rebounding was mostly brushed aside by stock and bond markets, though it boosted oil prices as investors hoped for a slow recovery in energy demand.
The S&P 500 <.SPX> fell 23.5 points, or 0.65%, to 3,511.20, but still within sight its record high of 3,580.84 struck on Sept. 2. The Dow Jones Industrial Average <.DJI> dropped 139.8 points, or 0.48%, to 28,699.30. The Nasdaq Composite <.IXIC> erased earlier gains to slip 36.3 points, or 0.3%, to 11,842.03 points.
Shares in Johnson & Johnson
Investors see the quick introduction of a vaccine as key to helping economies recover. J&J's news comes after its rival AstraZeneca
"Markets have already priced in perfection," said Ken Polcari, chief market strategist at SlateStone Wealth LLC in Florida. "It's 'buy the rumor, sell the news.'"
European shares also struggled as investors found a reason in news of Johnson & Johnson's delayed trial to take profits.
The Euro STOXX 600 <.STOXX> lost 0.77%, ending three straight days of gains, with markets in Frankfurt <.GDAXI>, London <.FTSE> and Paris <.FCHI> mirroring its moves.
The sentiment in European and U.S. equities defied earlier resilience in Asia, where Chinese shares got a lift from data that showed exports rising 9.9% in September and imports swinging to a 13.2% gain, versus a 2.1% drop in August.
The data suggested Chinese exporters were recovering from the pandemic's damage to overseas orders and helped Chinese blue-chip shares <.CSI300> rise 0.33%. MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS>, however, trimmed earlier gains and was little changed by the end of Tuesday.
The overall subdued mood in stock markets contrasted with the dollar, which is on track for its best daily performance in three weeks, as the dollar index <=USD> climbed 0.54% against a basket of other currencies to 93.546. [USD/]
The Australian dollar, on the other hand, was slugged by news that Beijing has stopped taking shipments of Australian coal. The Aussie
Government bond yields mostly fell as demand for safe-haven bonds firmed.
The benchmark 10-year Treasury
Government bond yields in the euro zone also held near recent troughs, with hefty supply failing to dent a market bolstered by expectations for further central bank easing.
Germany's 10-year Bund yield touched -0.538%
A stronger dollar capped gold
Benefiting from China's promising trade data, Brent crude futures
(Reporting by Koh Gui Qing; Editing by Steve Orlofsky)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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