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GLOBAL MARKETS-Asian shares make cautious gains, capped by fresh oil woes

Published 28/04/2020, 07:15
© Reuters.
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* End in sight for some lockdowns
* Oil suffers as USO ETF sells front-month futures
* Markets eye Fed, ECB meetings this week

By Stanley White and Chibuike Oguh
TOKYO/NEW YORK, April 28 (Reuters) - Most Asian shares
ground higher while U.S. stock futures fell on Tuesday amid
choppy trade as a renewed decline in oil prices partially offset
optimism about the easing of coronavirus-related restrictions.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS was down 0.2%. Shares in China .CSI300 rose
0.65%. South Korean shares .KS11 gained 0.4%, but shares in
Japan .N225 were little changed.
Euro Stoxx 50 futures STXEc1 were up 0.25%, German DAX
futures FDXc1 climbed 0.42%, and FTSE futures FFIc1 rose
0.27%, suggesting European shares are poised to gain.
Oil futures slumped after the largest U.S. oil
exchange-traded fund said it would sell all its front-month
crude contracts to avoid further losses as prices collapse.
Regional stock markets see-sawed between positive and
negative territory throughout the Asian session, amid low
trading volumes and as the focus swung between the oil panic and
encouraging signs on the coronavirus front.
Some investors are hoping the worst may be over for the
world economy as more countries allow businesses to re-open, but
others see reasons to remain cautious, especially as a
coronavirus vaccine has yet to be developed. "We are less optimistic and expect a slower recovery in the
world economy," Commonwealth Bank of Australia said in a
research note.
"The risk of reintroducing restrictions is a risk to market
participants' optimistic outlook for a quick resumption of
normal economic activity."
All three major U.S. stock averages advanced on Monday and
are all now within 20% of their record closing highs reached in
February.
The benchmark S&P 500 is on track for its best month since
1987, after trillions of stimulus dollars helped U.S. equities
claw back much of the ground lost since the coronavirus crisis
brought the economy to a grinding halt.
From Italy to New Zealand, governments announced the easing
of restrictions, while Britain said it was too early to relax
them there. New York state is not expected to reopen for weeks.
Oil prices weakened again on persistent concerns about
oversupply and a lack of storage space. The front-month contract
was trading at lower-than-usual volumes on Monday as traders
moved to later months in futures contracts.
U.S. crude CLc1 skidded 12.21% to $11.22 a barrel while
Brent crude LCOc1 fell 3.95% to $19.20 per barrel.
Shares of United States Oil Fund LP USO.P , the country's
largest crude ETF, fell more than 16% on Monday, after it said
it would sell all of its front-month crude contracts to avoid a
repeat of the heavy losses suffered last week. The U.S. dollar and the euro were little changed as traders
refrained from taking big positions before a Federal Reserve
policy decision due on Wednesday and a European Central Bank
(ECB) meeting Thursday.
The Fed has already announced a raft of measures to lessen
the economic blow from the coronavirus pandemic and is expected
to stay on hold this week.
The ECB is likely to extend its debt purchases to include
junk bonds and provide a backstop for corporate financing.
Major central banks have responded to the economic slump
caused by the coronavirus by slashing interest rates, buying
more government debt, and taking steps to increase lending to
small companies.
The slide in oil prices knocked the Australian dollar
AUD=D3 off a six-week high of $0.6472. The Aussie is often
traded as a proxy for risk because it has close links to global
commodities and China's economy.
The New Zealand dollar NZD=D3 also fell amid speculation
the country's central bank could cut interest rates into the
negative territory later this year. Gold XAU= , a safe-haven often bought during times of
uncertainty, fell 1.25% to $1,694.10 per ounce. The precious
metal is down for a third consecutive trading session in signs
of improving risk appetite.


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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Global bonds dashboard (DO NOT USE UNTIL UPDATE FOUND) http://tmsnrt.rs/2fPTds0
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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