Hedge funds cut NFLX, keep big bets on MSFT, AMZN, add NVDA
* Dollar stabilises after gaining on vaccine news
* Yen and Swiss franc recover losses
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
LONDON, Nov 10 (Reuters) - The dollar edged down slightly
on Tuesday and the Japanese yen recovered some of the previous
session's losses after news of progress towards a COVID-19
vaccine boosted risk appetite in global markets.
U.S. drugmaker Pfizer Inc PFE.N and German partner
BioNTech SE BNTX.O said on Monday a large-scale clinical trial
showed their vaccine was more than 90% effective in preventing
COVID-19. The dollar -- which is considered to be a safe haven and so
typically falls on positive news -- rose after the announcement,
as investors quit their long positions in safe currencies such
as the Japanese yen and Swiss franc. The safe-haven Japanese yen tumbled to a 20-day low versus
the dollar.
But these moves eased on Tuesday, with the yen and franc
clawing back some of their losses JPY=EBS CHF=EBS , as market
participants tempered their initial pro-risk reaction, in light
of uncertainty about how or when a vaccine could be rolled out.
"Following a euphoric market reaction such as that the
question that now arises is whether it was justified or possibly
exaggerated," wrote Commerzbank FX and EM analyst You-Na
Park-Heger in a note to clients.
"Even if the news of a vaccine could be a game changer, we
urge caution, as the massive euphoria could be followed by some
disenchantment," she said.
But Lee Hardman, currency analyst at MUFG, said that despite
the uncertainties "it is still an important step forward to exit
the COVID crisis and provides a reminder not to bet against
human ingenuity".
"It supports our baseline assumption behind our FX Outlook
that effective vaccines will be implemented next year," he
added. "Further positive progress on vaccines will allow
currencies which have been hit hard by the COVID crisis to
continue to rebound."
At 0813 GMT, the dollar index was at 92.730, broadly flat on
the day and up around 0.3% since Pfizer's announcement on Monday
=USD .
The dollar has lost around 1.4% this month as Democrat Joe
Biden's victory in the U.S. presidential election provided a
major boost to market sentiment. Euro-dollar was up around 0.1% at $1.18315, having fallen as
the dollar strengthened in the previous session EUR=EBS .
The Australian dollar - seen as a liquid proxy for risk
appetite - was up just 0.1% versus the U.S. dollar as the boost
from the vaccine news proved short-lived.
The New Zealand dollar was up 0.2%, in its seventh
consecutive session of gains NZD=D3 .
The Norwegian crown, which also benefited from the vaccine
news, extended its gains versus the euro on Tuesday, up 0.3% on
the day at 10.652 EURNOK=D3 .
China's offshore yuan, which has been gradually
strengthening since May, hit new 2.5-year highs versus the U.S.
dollar on Monday but eased some gains on Tuesday, up 0.3% on the
day at 6.5970 at 0827 GMT CNH=EBS .
U.S. President Donald Trump plans to push ahead with legal
challenges to the presidential election results and will hold a
series of campaign-style rallies to build support.