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GLOBAL MARKETS-Global share markets rise after U.S. inflation remains contained

Published 13/04/2021, 16:59
© Reuters.
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* Bitcoin hits new record
* China imports rise at fastest pace in 4 years
* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh

By Herbert Lash
NEW YORK, April 13 (Reuters) - A gauge of global shares rose
on Tuesday, led by surging technology-related stocks, as
Treasury bond yields eased on U.S. consumer price data for March
that showed the pace of inflation was not spiking wildly, as
some feared.
The consumer price index jumped 0.6%, the largest gain since
August 2012, as increased vaccinations and massive fiscal
stimulus unleashed pent-up demand. But the data is unlikely to
change Federal Reserve Chair Jerome Powell's view that higher
inflation in coming months will be transitory. "We're just going to have a temporary flame-up in prices but
there will not be any structural inflation that's here to stay,"
said Carlo Franchini, head of institutional clients at Banca
Ifigest SpA in Milan. "Fed comments continue to be
conciliatory."
The U.S. dollar fell and the price of inflation-hedge gold
rebounded from its lowest in more than a week. But equity
markets took the data in stride, especially technology-heavy
indexes whose stocks could be affected by rising debt costs.
MSCI's gauge of stocks across the globe .MIWD00000PUS
gained 0.23%, while the pan-European STOXX 600 index .STOXX
rose 0.13%. The top five holdings of the MSCI all-country world
index are the big U.S. technology companies.
On Wall Street, the Dow Jones Industrial Average .DJI fell
0.37%, the S&P 500 .SPX gained 0.11% and the Nasdaq Composite
.IXIC added 0.5%.
Asian stocks overnight gained support on China trade data
that showed exports in dollar terms rose more that 30% in March
from a year earlier, short of expectations. Imports jumped 38%,
their fastest pace in four years, suggesting a post-pandemic
recovery in Chinese spending. MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS gave up most of its gains and closed up 0.1%.
China's blue-chip index fell 0.2%. .CSI300
Treasury yields are being influenced by increased foreign
demand while low bond yields and the cost of debt will buoy
higher-risk equity assets, said Steven Oh, global head
of credit and fixed income at PineBridge Investments.
"The Treasury market reaction (to CPI) was effectively a
collective yawn in continuing the trend that in the near term,
market yields are largely unrelated to economic data," Oh said.
"Inflation and economic data matters in determining Treasury
yields, but it's been and will be a secondary factor for now."
Benchmark 10-year notes US10YT=RR fell 1.7 basis points to
yield 1.6552%, well below a 14-month high of 1.776% reached on
March 30.
Later on Tuesday, the U.S. Treasury will auction $24 billion
of 30-year bonds after Monday's three- and 10-year note auctions
performed relatively smoothly.
The dollar briefly spiked on the CPI data before reversing
course and dipping to three-week lows after surging to
multi-month peaks in March as markets anticipated fiscal
stimulus would spur faster U.S. economic growth and higher
inflation.
The dollar index =USD fell 0.167%, with the euro EUR= up
0.23% to $1.1936. The Japanese yen strengthened 0.16% versus the
greenback at 109.19 per dollar.
Boston Federal Reserve Bank President Eric Rosengren said on
Monday the U.S. economy could see a significant rebound this
year due to looser money and fiscal policy but the country's job
market still faced weakness.
He said with inflation still below the central bank's 2%
target rate, the current "highly accommodative" monetary policy
stance remained appropriate. Bitcoin BTC=BTSP hit a record of $63,199 on Tuesday,
extending its 2021 rally to new heights a day before the listing
of Coinbase shares in the United States. Brent crude futures LCOc1 rose $0.66 to $63.94 a barrel.
U.S. crude futures CLc1 gained $0.64 to $60.34 a barrel.




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World FX rates YTD http://tmsnrt.rs/2egbfVh
Global asset performance http://tmsnrt.rs/2yaDPgn
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