(Adds graphic)
* European shares climb to highest since early March
* German DAX plays catch up after day off
* U.S. unrest and China-U.S. worries rumble in background
* Dollar nurses losses after Monday's tumble
By Marc Jones
LONDON, June 2 (Reuters) - World stocks climbed to
three-month highs on Tuesday as the global coronavirus recovery
effort won out over U.S.-China tensions and the worst civil
unrest in the United States in decades.
U.S. President Donald Trump's vow to use force to end
violent protests and reports that China had ordered U.S. soybean
purchases to be halted had caused a brief wobble in Wall Street
futures, but Europe got shares back on track. .N .EU
The STOXX 600 .STOXX jumped over 2% and Germany's DAX
.GDAXI surged nearly 4% after a holiday on Monday as
Lufthansa's board approved its government bailout and carmakers
shone. Volkswagen VOWG_p.DE , Daimler DAIGn.DE and BMW
BMWG.DE shares all leapt over 6% on talk of a 5 billion- euro
government-funded car buying scheme. .EU
The euro EUR= hit a two-and-a-half-month high too as the
dollar struggled with its home-grown strains /FRX , and Italian
and Spanish bonds were still being helped by a proposed 750
billion-euro EU stimulus plan and European Central
Bank buying. GVD/EUR
"In a way, it is remarkable that the market remains in this
positive mood," said Elwin de Groot, head of macro strategy at
Rabobank. "Even with these rising protests in the U.S. and the
situation in Hong Kong at the moment, the market is pushing on
and seeing room for optimism."
Demonstrators, angered over the recent death of 46-year old
African American George Floyd in police custody, had set fire to
a mall in Los Angeles overnight, looted stores in New York and
at least five U.S. police had been hit by gunfire. Wall Street futures ESc1 had dipped in Asia but Europe
dragged them back up in its slipstream ahead of U.S. trading.
.N
World stock markets .MIWD00000PUS have rallied nearly 36%
from March lows on hopes for a swift recovery from the
coronavirus-induced collapse in world growth. The tech-heavy
Nasdaq is now only 3% from its pre-virus record highs. .N
May Purchasing Managers Index data pointed to a fragile but
encouraging recovery in global manufacturing, raising hopes that
the worst is over. In Asia, Japan's Nikkei .N225 rose 1.2% to its highest
since late February and markets in Seoul .KS11 , Taipei
.TWII , Hong Kong .HSI and China .SS also gained as the
central bank there also provided another shot of stimulus.
"This optimistic read for risk can only persist if measures
like orders and employment continue to improve month to month,"
said Alan Ruskin, chief international strategist at Deutsche
Bank.
"Early setbacks would be a very poor sign, but are not
expected in the period immediately following the end of
lockdowns."
BOIL OVER
The dollar was at multi-month lows against most major
currencies following a 5% drop for its main index =USD since
March. FRX/
The euro got as high as $1.1160, Britain's pound topped
$1.2530 GBP= for the first time in over a month and the
Canadian CAD= and Australian dollars AUD= both rose around
0.4% as commodity markets continued their recoveries.
"The protests are part of the reason for the sell-off in the
dollar over the last four or five days," said CMC Markets senior
analyst Michael Hewson.
"When there are riots on the streets and the president is
saying the military will be called in, it adds some near-term
uncertainty."
Brent oil LCOc1 rose another 2% to just over $39 a barrel.
Traders are expecting major producers to extend output cuts at
an OPEC+ meeting later in the week. U.S. crude CLc1 was up 1%
at $35.86 a barrel. O/R
Copper prices were at their highest in nearly three months
on signs that demand from top metals consumer China was
recovering.
Stockpiles CU-STX-SGH dropped at the fastest pace last
week since September 2017, data showed. Aluminium producer Rusal
0486.HK said its customers were gradually returning after a
major slump in April.
"This is real demand. Domestic investment is
booming，especially in infrastructure. Supply and transport
slowdowns from South America are also supporting prices," said a
copper trader in China.
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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country World Index Market Cap http://tmsnrt.rs/2EmTD6j
Asia stock markets https://tmsnrt.rs/2zpUAr4
What goes down must come up https://tmsnrt.rs/2MjI9Ti
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(Additional Reporting by Mai Nguyen and Tom Westbrook in
Singapore; editing by Larry King, Susan Fenton, William Maclean)