Most Asian benchmarks fall, Japanese yen rallies

Bloomberg

Wednesday brought another day of reversals in many major markets, with US stock futures dropping, the dollar weakening and Treasury yields falling after surging a day earlier.
Contracts on the S&P 500 Index fell about 2% after the US administration failed to offer details on what President Donald Trump said would be “major” measures to combat the economic impact of the coronavirus. The Stoxx Europe 600 climbed as the European Central Bank indicated it may act as soon as this week and the Bank of England (BOE)
cut rates.
Most Asian benchmarks fell, while the yen rallied. Crude oil’s rebound from its biggest crash in a generation faltered after Saudi Arabia said it would boost production.
The pound fluctuated before turning higher and gilts declined after the BOE reduced its main interest rate by 50 basis points.
The BOE’s emergency move came a week after the Federal Reserve slashed its main rate, and as ECB President Christine Lagarde warned of an economic shock similar to the financial crisis unless leaders act urgently — comments which suggest the bank may join the wave of crisis easing when it sets policy on Thursday.
The UK pledged a 30 billion pound ($39 billion) emergency boost to spending as Boris Johnson’s government battles to stop the coronavirus outbreak wrecking its economy.
“Despite the hopes for fiscal stimulus everywhere, we see significant downside risks,” said Guillaume Tresca, a strategist at Credit Agricole SA in Paris.
“As long as uncertainties remain on the number of cases, and central banks’ actions and fiscal stimulus plans are not lifted, we see few reasons for a protracted and long-term rebound.”
Meanwhile, Joe Biden cemented his position as front-runner for the US Democratic presidential nomination with primary victories, further easing concerns among those opposing Bernie Sanders’s progressive platform.
The European Central Bank’s policy decision comes on Thursday amid expectations it may ease policy.
The UK Chancellor of the Exchequer was expected to unveil the government’s 2020 budget on Wednesday.
The US core consumer price index was expected to remain subdued in February.
The Stoxx Europe 600 Index rose 1.4% in New York. Futures on the S&P 500 Index decreased 2%. The MSCI All-Country World Index dipped 0.1%. The UK’s FTSE 100 Index gained 0.8%.
The Bloomberg Dollar Spot Index dipped 0.2%. The euro rose 0.3% to $1.1315. The British pound gained 0.2% to $1.294. The Japanese yen strengthened 0.7% to 104.94 per dollar.
The yield on 10-year Treasuries sank 10 basis points to 0.70%. The yield on two-year Treasuries fell nine basis points to 0.44%. Germany’s 10-year yield increased three basis points to -0.76%. Britain’s 10-year yield gained five basis points to 0.288%.
West Texas Intermediate crude fell 3.3% to $33.23 a barrel. Gold strengthened 0.8% to $1,663.03 an ounce.