LONDON / HONG KONG (Reuters) – Global equities rebounded on Tuesday as strong trade data from China boosted confidence for a rise in domestic demand, with market participants expecting US data United States showed a rise in inflation.
China’s dollar exports rose more than 30% in March from a year earlier, while imports rose 38%, the fastest pace in four years, suggesting a post-pandemic recovery of internal expenditure.
The broad euro STOXX 600 gained 0.3% to record highs, with heavy German shares exporting 0.2%. Paris and London stock indices fell 0.1%.
Investors focused on US inflation data for March, forecast at 12:30 GMT. Markets expect a recovery in inflation forecast to accelerate recent movements of equity investors towards cyclical equities.
“The question for the coming months is not whether inflation will rise, but to what extent inflation will rise,” said Hugh Gimber, global market strategist at JP Morgan Asset Management.
“We see the scope for further increases in Treasury yields throughout 2021. We would expect this to drive a continuation of the rotation we have seen over the last six months or so towards more cyclical sectors.”
The U.S. 10-year benchmark Treasury yield rose 1.6908%, staying below the 14-month high of 1.776% on March 30th. Bond yields rise when prices fall.
The MSCI global equity index, which tracks the actions of 49 countries, fell.
Wall Street futures indicators were flat.
Earlier, Asian equities had gained solid trading data from China, although MSCI’s broader Asia-Pacific equities index outside of Japan dropped its gains, as did the blue index. of China, CSI300.
“China is benefiting from its strong ‘first, first’ recovery, but the world economy is also accelerating and recovering, and this will slow down part of China’s export performance in the coming quarters,” he said. say John Woods, Credit Suisse’s chief Asia-Pacific investor. official.
“SIGNIFICANT RECOVERY”
In foreign exchange markets, the dollar rose nearly a three-week low on Tuesday compared to other major currencies, driven by a sharp rise in Treasury yields.
The dollar has fallen along with U.S. yields this month after hitting several-month highs as markets expect a major fiscal stimulus, along with continued monetary easing, will stimulate economic growth of the United States and higher inflation.
Boston Federal Reserve Bank President Eric Rosengren said Monday that the U.S. economy could experience a significant rebound this year due to weaker financial policy and fiscal policy, but the country’s labor market he was still with weaknesses.
He said that with inflation still below the central bank’s 2% target rate, the current “highly accommodative” monetary policy stance remained adequate.
Brent crude oil futures rose 37 cents, or 0.5%, to $ 63.63 a barrel at 0744 GMT. U.S. crude futures gained 27 cents, or 0.5%, to $ 59.58 a barrel.
Report by Tom Wilson in London and Scott Murdoch in Hong Kong; edited by Stephen Coates, Simon Cameron-Moore and Larry King