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GLOBAL MARKETS-Safe-havens rise on coronavirus concerns, stocks rebound

Published 10/02/2020, 17:49
Updated 10/02/2020, 17:55
© Reuters.  GLOBAL MARKETS-Safe-havens rise on coronavirus concerns, stocks rebound
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(Adds U.S. market open, changes dateline; previous LONDON)

* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

* Coronavirus death toll climbs past 900, exceeds SARS toll

of 774

* MSCI world index rebounds, Wall Street rallies

* Dollar takes breather after rally last week

By Herbert Lash

NEW YORK, Feb 10 (Reuters) - Gold rose and the dollar hit a

four-month high against the euro on Monday as the death toll

from coronavirus outbreak passed that of the SARS epidemic two

decades ago, boosting demand for safe havens.

Wall Street, however, rebounded on a strong U.S. economic

outlook, with the Nasdaq hitting a record high.

Weak economic data in the eurozone made the dollar

relatively more attractive than the single currency, especially

considering Friday's U.S. non-farm payrolls report showing an

acceleration in job growth in January.

Data on Monday showed Italian industrial output was much

weaker than expected in December, another setback for the euro

after data on Friday showed German industrial output suffered

its biggest fall since the recession-hit year of 2009.

A gauge of global equity markets traded little changed,

paring most losses after Wall Street rebounded in contrast to

declining share prices in Europe, which also fell on concerns

about the extent of the coronavirus.

"We have the safe-haven bid from the coronavirus. That is

killing EM and really benefiting the dollar, and to a lesser

extent the yen and Swiss," said Win Thin, global head of

currency strategy at Brown Brothers Harriman in New York.

MSCI's gauge of stocks across the globe .MIWD00000PUS

gained 0.06% while the pan-European STOXX 600 index .STOXX

rose 0.06%.

On Wall Street, the Dow Jones Industrial Average .DJI rose

101.67 points, or 0.35%, to 29,204.18. The S&P 500 .SPX gained

14.36 points, or 0.43%, to 3,342.07 and the Nasdaq Composite

.IXIC added 67.76 points, or 0.71%, to 9,588.27.

Investors continued to monitor the advance of the deadly

coronavirus, which has killed more than 900 people as of Sunday,

mostly in China's provincial capital of Wuhan, the epicenter of

the outbreak.

Electric carmaker Tesla Inc TSLA.O rose 2.6% as its

Shanghai factory returned to service. People across China trickled back to work after the extended

Lunar New Year holiday. The government eased restrictions

imposed to counter the coronavirus but the World Health

Organization said the number of cases outside China could be

just "the tip of the iceberg." The dollar index .DXY rose 0.18%, with the euro EUR=

down 0.29% to $1.0911. The Japanese yen JPY= weakened 0.01%

versus the greenback at 109.79 per dollar.

Bond yields fell. The benchmark 10-year U.S. Treasury

note US10YT=RR rose 5/32 in price to yield 1.5593%.

The full economic impact of the virus is still unknown but

is expected to exacerbate a slowdown in the Chinese economy.

Treasury debt, which serves as a safe-haven investment in

times of geopolitical and economic volatility, has been in

demand since the start of the year. The 10-year Treasury yield

US10YT=RR , which moves inversely to price, has fallen 17.8%

since Dec. 31.

Shares overnight in Asia mostly fell. Japan's Nikkei .N225

was off 0.6%, South Korea's KOSPI .KS11 was 0.5% weaker while

Australia's benchmark index .AXJO eased 0.14%.

China's indexes were the only ones in the black in Asia,

with the blue-chip index .CSI300 adding 0.4% and Shanghai's

SSE Composite .SSEC up 0.5%.

Oil prices dipped on weaker Chinese demand due to the

coronavirus outbreak and as traders waited to see if Russia

would join other producers in seeking further output cuts.

Oil has dropped more than 20% from a peak in January after

the spreading virus hit demand in the world's largest oil

importer and fueled concerns of excess supplies.

Brent crude LCOc1 slipped 60 cents to $53.87 a barrel,

while U.S. West Texas Intermediate CLc1 fell 49 cents to

$49.83 a barrel or 0.5%.

U.S. gold futures GCcv1 were 0.2% higher at $1,576.80 an

ounce.

Stocks stabilize as pace of reported virus infections slows https://tmsnrt.rs/2tyLx6W

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