Stocks climb after biggest rout since financial crisis

Bloomberg

Stocks climbed globally along with US index futures on Tuesday, recovering some ground after the deepest equity rout since the great financial crisis. Bonds and haven currencies trimmed their exceptional gains from a day earlier and the dollar strengthened.
The Stoxx Europe 600 Index jumped alongside contracts on the three main American gauges, though few benchmarks came close to recovering their historic losses from March 09. The twin worries of a price war in the oil market and worsening coronavirus outbreak remain front and centre for investors.
Equities rose across Asia, with those in Japan closing in the green after earlier sliding more than 4%. Brent crude futures clung to gains of around 5% after crashing on March 09. The yen slid alongside the Swiss franc. Ten-year Treasury yields retraced more than half of yesterday’s tumble.
Investors watched S&P 500 futures briefly slip to 20% below their high — signalling a bear market — only for them to reverse after President Donald Trump said his administration would discuss a possible payroll tax cut with Congress, and that “major” economic announcements were expected on Tuesday.
Treasury Secretary Steven Mnuchin rejected comparisons with the financial crisis.
Measures to contain the coronavirus continue to undermine prospects for corporate earnings, and raise the danger of a funding crisis, while the oil price crash threatens a swath of defaults among producers. Italy added nationwide travel restrictions to its effective lockdown of the northern region of the country.
“While things feel like the end-of-days I’d stay risk averse in the near-term, but expect bear market rallies,” Chris Weston, head of research at Pepperstone Group, said.
The European Central Bank’s policy decision comes on Thursday amid expectations it may ease policy.
The UK Chancellor of the
Exchequer unveils the government’s 2020 budget on Wednesday.
The US core consumer price index, due on Wednesday, is expected to remain subdued in February.
The Stoxx Europe 600 Index surged 3.5% in London. Futures on the S&P 500 Index jumped 4%. The MSCI Asia Pacific Index advanced 0.5%. The MSCI All-Country World Index climbed 0.6%.
The Bloomberg Dollar Spot Index climbed 0.5%. The euro sank 0.8% to $1.1362. The British pound fell 0.5% to $1.3057. The Japanese yen weakened 2.1% to 104.54
per dollar.
The yield on 10-year Treasuries jumped 17 basis points to 0.71%. The yield on two-year Treasuries climbed 10 basis points to 0.48%. Germany’s 10-year yield jumped 12 basis points to -0.74%. Japan’s 10-year yield advanced 12 basis points to -0.048%.
Brent crude jumped 5.1% to $36.10 a barrel. Gold weakened 1.1% to $1,662.23 an ounce. LME zinc climbed 1.7% to $2,013 per metric ton. Iron ore surged 4.4% to $88.75 per metric ton.