* Eyes on Fed minutes, Jackson Hole meeting for rate outlook
* Renault (PA:RENA), Fiat tie-up hopes boost shares
(Updates with U.S. markets, changes comments, byline, dateline
from previous LONDON)
By Rodrigo Campos
NEW YORK, Aug 21 (Reuters) - A global equities gauge rose on
Wednesday for a third day in four as bets on more economic
stimulus overcame, for now, worries over the rising prospect of
a global recession.
Strong earnings in the United States and the report of talks
on a mega merger in European autos triggered gains in stocks,
and the improved risk sentiment drove safe-haven yields higher
while the yen and gold edged lower.
Traders expect that the Federal Reserve's annual Jackson
Hole symposium and a Group of Seven summit this weekend will
shed light on the next steps policymakers will take to support
economic growth.
Much depends on what the Fed does with U.S. interest rates,
making markets hyper-sensitive to the minutes of its latest
meeting, due later on Wednesday. That meeting ended with what
traders dubbed a "hawkish rate cut," missing expectations for an
even more supportive Fed.
"Today's release of the FOMC minutes could show how the
risks related to global trade could warrant further rate cuts,"
said Edward Moya, senior market analyst at OANDA, pointing to
the importance of Fed Chairman Jay Powell's speech in Jackson
Hole expected Friday.
Auto shares .SXAP led European stocks higher after Italian
media suggested the merger talks between Fiat Chrysler and
Renault have continued despite reports to the contrary.
Across the Atlantic, earnings from Target (NYSE:TGT) and Lowe's boosted
consumer-centered stocks and overall market sentiment.
The Dow Jones Industrial Average .DJI rose 255.81 points,
or 0.99%, to 26,218.25, the S&P 500 .SPX gained 24.18 points,
or 0.83%, to 2,924.69 and the Nasdaq Composite .IXIC added
80.19 points, or 1.01%, to 8,028.75. The pan-European STOXX 600 index .STOXX rose 1.13% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.69%.
Emerging market stocks rose 0.29%. MSCI's broadest index of
Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.11%
lower, while Japan's Nikkei .N225 lost 0.28%. RISE, YEN FALLS
Futures markets have fully priced a 25-basis-point cut in
next month's Fed meeting. On Wednesday, U.S. Treasury yields
rose as rising stock prices reflected improving risk sentiment,
with traders keeping an eye out for the Fed minutes.
Benchmark 10-year notes US10YT=RR last fell 3/32 in price
to yield 1.569%, from 1.559% late on Tuesday. Germany sold 30-year bonds with a negative yield for the
first time at an auction on Wednesday, a milestone for a
fixed-income market where the entire curve now yields less than
zero. The very weak demand seen at the auction was
expected. Crude oil futures rose after industry data showed a larger
than expected drop in U.S. crude inventories, but worries about
a possible global recession capped gains.
U.S. crude CLc1 rose 0.94% to $56.66 per barrel and Brent
LCOc1 was last at $61.01, up 1.63% on the day. In currencies, the dollar rose against the Swiss and
Japanese safe-haven currencies and the dollar index .DXY was
flat, with the euro EUR= down 0.04% to $1.1095. Sterling
GBP= was last trading at $1.213, down 0.31% on the day.
The Japanese yen weakened 0.22% versus the greenback at
106.47 per dollar.
Spot gold XAU= dropped 0.3% to $1,502.50 an ounce.
GRAPHIC-Global assets in 2019 http://tmsnrt.rs/2jvdmXl
GRAPHIC-World FX rates in 2019 http://tmsnrt.rs/2egbfVh
GRAPHIC-MSCI All Country World Index Market Cap http://tmsnrt.rs/2EmTD6j
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