Gold prices edge higher on raised Fed rate cut hopes
By David Randall
NEW YORK, May 13 (Reuters) - Stock markets slid on Wednesday
as fears about a second wave of coronavirus infections and as
warnings from Federal Reserve Chairman Jerome Powell that the
U.S. faces a "significantly worse" recession than any since
World War II weighed on investor sentiment and boosted
safe-haven bonds.
Powell's comments come as parts of the global economy are
starting to reopen following a deep freeze aimed at curbing the
spread of the virus that has pushed unemployment rates to their
highest since the Great Depression Benchmark
equity indexes are up 25% or more since their March lows in
anticipation of further government stimulus programs to help the
global economy recover.
"Earnings season is largely behind us and we have entered
the phase two of COVID-19 as de-confinement of economies begins,
and that is creating a lot of uncertainties on a daily basis,
which is weighing on markets," said Francois Savary, chief
investment officer at Swiss wealth manager Prime Partners.
"We don't think this is the start of a new correction.
Markets went too far, too fast and this is the consolidation."
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.34% following broad losses in Europe and Asia.
In morning trading on Wall Street, the Dow Jones Industrial
Average .DJI fell 109.35 points, or 0.46%, to 23,655.43, the
S&P 500 .SPX lost 5.43 points, or 0.19%, to 2,864.69 and the
Nasdaq Composite .IXIC added 13.42 points, or 0.15%, to
9,015.97.
Leading U.S. infectious disease expert Anthony Fauci on
Tuesday warned lawmakers that a premature lifting of lockdowns
could lead to additional outbreaks of the deadly coronavirus,
which has killed 80,000 Americans and brought the economy to its
knees. The mood was further soured by proposed legislation by a
leading U.S. Republican senator that would authorize President
Donald Trump to impose sanctions on China if it fails to give a
full account of events leading to the coronavirus outbreak.
Safe-haven assets rose as investors positioned for an
extended economic downturn. Benchmark 10-year notes US10YT=RR
last rose 8/32 in price to yield 0.6654%, from 0.692% late on
Tuesday.
Oil markets, which have plummeted this year due to a
combination of a collapse in demand and a supply glut, regained
some ground on expectations of deeper production cuts.
U.S. crude CLc1 was up 0.58% at $25.93 per barrel and
Brent LCOc1 was at $30.01, up 0.1% on the day.
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Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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