S&P 500 gains to extend record run, set for positive week
(Adds U.S. market open, byline, changes dateline; previous
LONDON)
* Stocks edge down, caution ahead of Fed
* Dollar index touches new three-month lows
* Oil tumbles on rising U.S. inventories
By Herbert Lash
NEW YORK, June 10 (Reuters) - The dollar slid to a
three-month low and a gauge of global equities edged lower on
Wednesday as investors awaited news at the end of a two-day
meeting of the Federal Reserve and its plans to strengthen a
nascent U.S. economic recovery.
The technology-centric Nasdaq hit a new high and Asian
equities extended a streak overnight, but stocks were mostly
subdued even as the Fed is likely to emphasize its promise of
loose monetary policy for perhaps years to come. U.S. Treasury yields fell on expectations the Fed will
signal its intention to keep interest rates near zero for the
next few years as it attempts to revive a U.S. economy now
officially in recession since February. MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.14% while the pan-European STOXX 600 index .STOXX lost
0.52%.
Hank Smith, co-chief investment officer at Haverford Trust,
said the firm is bullish intermediate to long-term as the Fed
will be accommodative for several years, but he acknowledged a
"breather" is due for stocks.
"A pullback would be healthy and one cannot rule out a
correction, given the magnitude of this advance," Smith said in
a note.
On Wall Street, the Dow Jones Industrial Average .DJI fell
227.39 points, or 0.83%, to 27,044.91. The S&P 500 .SPX lost
12.54 points, or 0.39%, to 3,194.64 and the Nasdaq Composite
.IXIC added 50.95 points, or 0.51%, to 10,004.70.
Demand remains subdued as seen in U.S. consumer prices,
which fell for a third straight month in May, with underlying
inflation weak. The consumer price index dipped 0.1% last month
after plunging 0.8% in April, the largest decline since December
2008. But copper prices rose for a fifth straight session to their
highest since January as the metal, which is widely used in the
construction and power industries, has been supported by firm
demand and an improved technical picture.
Benchmark copper CMCU3 on the London Metal Exchange (LME)
was up 0.8% at $5,822 per tonne in official trading.
Oil fell more than 2% toward $40 a barrel after a report
showed a rise in U.S. crude inventories, reviving concerns about
oversupply and weak demand because of the coronavirus crisis.
The American Petroleum Institute said crude stocks rose by
8.4 million barrels, rather than falling as analysts forecast.
API/S The U.S. government's official stocks figures are due
out later on Wednesday. EIA/S
U.S. crude CLc1 recently fell 1.8% to $38.24 per barrel
and Brent LCOc1 was at $40.63, down 1.34% on the day.
The dollar slid on increased speculation the Fed will
announce at 2 p.m. that it intends to keep the recent rise in
bond yields in check.
The dollar index =USD fell 0.283%, with the euro EUR= up
0.19% to $1.1362. The Japanese yen JPY= strengthened 0.41%
versus the greenback at 107.31 per dollar.
Some investors believe the Fed may decide now or at a later
date to adopt yield-curve control measures to guide 10-year
Treasury yields lower.
Benchmark 10-year notes US10YT=RR fell 4.3 basis points to
yield 0.7856%.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS advanced 0.66% for its 10th straight session of
gains.
Data showing the sharpest slump in China's producer prices
in four years - pointing to flagging global demand - served as a
reminder of the impact the coronavirus pandemic is having on the
global economy. So did the latest outlook from the Organization for Economic
Cooperation and Development (OECD), which said the global
economy will suffer the biggest peacetime downturn in a century
before it emerges next year from recession. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Asset performance, year-to-date https://tmsnrt.rs/3fafQTC
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>