Bitcoin price today: gains to $120k, near record high on U.S. regulatory cheer
* Europe drops after world stocks hit record high in Asia
* Safe-harbour bonds and yen make ground
* Rand and lira take the pain in emerging markets
* World FX rates in 2020 http://tmsnrt.rs/2egbfVh
By Marc Jones
LONDON, Jan 14 (Reuters) - Europe's markets were struck by a
bout of weakness on Tuesday, as traders cashed in on recent
record highs and waited for a long-awaited U.S.-China trade deal
and the first flurries of the Wall Street earnings season.
It had been smooth sailing in Asia. MSCI's world stocks
index set a new record high after reassuring Chinese data and
Washington had said it no longer deemed Beijing a currency
manipulator, but Europe's open saw the currents turn.
Dealers struggled to put their finger on the exact cause but
London, Frankfurt and Paris all took an early dip to leave the
regional STOXX 600 .STOXX as much as 0.5% lower and bonds and
other safe-haven assets suddenly back in demand. GVD/EUR
"You had some good news in terms of China coming off the
list of currency manipulators and so you would have expected
bond prices to extend losses," said Andy Cossor, a rates
strategist at DZ Bank in Frankfurt.
"So, I think it might be a case that people got ahead of
themselves yesterday and are covering short positions."
A number of heavyweight emerging market currencies were on
the ropes too. The highly-sensitive South African rand hit a
three-week low and Turkey's lira took its biggest tumble since
mid-December. EMRG/FRX
China's yuan also backed off its highest since July hit
overnight after the U.S. Treasury Department on Monday said
China should no longer be designated a currency manipulator - a
label it applied as the yuan dropped in August. Beijing, meanwhile, had given its approval too by fixing the
yuan's official trading-band midpoint at its firmest in more
than five months.
China has also pledged to buy an additional almost $80
billion of U.S. manufactured goods over the next two years, plus
more than $50 billion extra in energy supplies, according to a
source briefed on a trade deal.
The change in the mood in Europe had also come as Wall
Street and other U.S. futures turned lower after their latest
record highs on Monday ESc1 .
The moves coincided with the arrival of a Chinese delegation
in Washington ahead of Wednesday's signing of the Phase 1 trade
agreement, seen as calming a dispute that has upended the world
economy. "There have been a number of false starts," said Vishnu
Varathan, head of economics at Mizuho Bank in Singapore.
"The fact that this is really coming to the moment when the
rubber hits the road is the most tangible evidence of traction
in starting to resolve issues, that's what's driving optimism."
In contrast to Europe's swoon, Japan's Nikkei .N225 had
added 0.7% overnight to hit its highest in a month. Australian
shares rose by the same margin to close at a record .AXJO .
Hong Kong's Hang Seng .HSI and Shanghai blue chips
.CSI300 also hit multi-month peaks before running out of
steam.
United States Trade Representative Robert Lighthizer told
Fox Business late on Monday that the Chinese translation of the
deal's text was almost done. "We're going to make
it public on Wednesday before the signing," he said.
NEW SEASON
In tandem with the swings, gold began to claw off a two-week
low, although it was still around 0.3% weaker for the day as a
whole at $1543 per ounce. GOL/
Ten-year Treasury note yields US10YT=RR dropped a couple
of ticks 1.8354% compared with the 1.85% they had been at in
Asia.
In currency markets, the yen also stabilised after weakening
past the 110 yen-per-dollar mark, and the Swiss franc was
marginally higher against a lifeless euro.
Besides the trade deal, investors are also looking to U.S.
inflation data due at 1330 GMT - with consensus expectations for
it to hold steady at 0.2% in December - and the beginning of the
fourth-quarter U.S. company results season.
Big banks JPMorgan Chase & Co JPM.N , Citigroup Inc C.N
and Wells Fargo & Co WFC.N are due to report earnings before
market open on Tuesday.
U.S. Treasury drops China currency manipulator label ahead of
trade deal signing White House plans US-China Phase 1 ceremony, still no final
deal text Dec yuan-denominated exports up 9%, imports up 17.7%
Lighthizer says nearly done with translation of China trade
deal businesses hold back, U.S. consumers seen boosting
big banks' profits ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Additional Reporting by Tom Westbrook in Singapore and Dhara
Ranasinghe in London, Editing by William Maclean)