Fall in stocks, rebound in oil: “ The mood is quite fragile ”

NEW YORK (Reuters) – Global stocks fell and the dollar hovered near its four-month highs on Wednesday as concerns over prolonged economic lockdowns in Europe and the potential for tax hikes in the United States weighed on investor sentiment.

European stocks fell to nearly two weeks, while oil prices rebounded after steep losses on Tuesday after a ship ran aground in the Suez Canal, although traffic is expected to resume soon.

“The mood is quite fragile as all the optimism that has characterized the upward push in the past two or three weeks in equities begins to dissipate as they speak of a third European wave and the extensions of pandemic lockdowns in Germany and in France, “said Michael Hewson, chief market analyst at CMC Markets.

The MSCI indicator of equities across the world fell 0.21% after sharp declines in Asia and modest losses in Europe.

By midday on Wall Street, the Dow Jones Industrial Average rose 271.55 points, or 0.84%, to 32,694.7, the S&P 500 gained 19.91 points, or 0.51%, to 3,930 , 43 and the Nasdaq Composite fell 45.36 points, or 0.34%, to 13,182.33. .

The Ifo Institute said Germany’s prolonged lockdown was delaying a recovery. He cut his 2021 growth forecast for Europe’s largest economy to 3.7%, from 4.2% previously.

The Eurozone IHS Markit flash purchasing management composite index fell from 48.8 in February to 52.5 in March, a surprise return to growth this month as factories accelerated their fastest-paced production in over 23 years.

But April’s figures could be affected by the increasing rate of COVID-19 infections across Europe.

Benchmark 10-year ratings last fell 1/32 of their price to 1.6419%, down from 1.638% on Tuesday night.

U.S. Treasury Secretary Janet Yellen said on Tuesday that the U.S. economy remains in crisis due to the pandemic as she defends making plans for future tax increases to pay for new public investment.

Federal Reserve Chairman Jerome Powell has told U.S. lawmakers that the next round of price hikes after the pandemic will not fuel a destructive surge in persistent inflation.

The dollar index rose 0.073%, with the euro down 0.16% to $ 1.183.

“We’re definitely in this mode of further potential reduction in risk, which would support the dollar,” said Derek Halpenny, research manager for global markets at MUFG.

“If you had to pick a major concern then that would be the COVID situation, with new cases in emerging markets at record levels and what’s happening in Europe. This does not match the global optimism for synchronized global growth, ”added Halpenny.

Bitcoin rose 3% as Tesla Incchief Elon Musk said the company’s electric vehicles can now be purchased using Bitcoin.

US crude rose 4.71% to $ 60.48 a barrel and Brent was at $ 63.62, up 4.66% on the day.

Spot gold added 0.2% to $ 1,730.20 an ounce.