Stocks advance as trade hopes grow; dollar steady

Bloomberg

Stocks extended gains around the globe on Wednesday after President Donald Trump signaled a more conciliatory stance towards China, fueling hopes of a breakthrough in the trade war when talks get underway later in the week. The dollar edged higher along with Treasuries.
Futures on the S&P 500, Nasdaq and Dow Jones climbed as investors awaited earnings reports from companies including Cisco Systems. The Stoxx Europe 600 Index rose for a third day as beer maker Heineken and chemicals producer Akzo Nobel delivered upbeat reports. Equities advanced across Asia, with shares in Shanghai surging the most in five weeks, after Trump said he’s open to extending a March 1 deadline to raise tariffs on Chinese products if the two sides are near an agreement.
The euro fluctuated before trading little changed after a report showed industrial production across the 19-nation region is falling at the fastest pace since the financial crisis. Oil added to its rebound from a two-week low after Saudi Arabia pledged to deepen output cuts.
With major central banks seemingly on pause or turning dovish, investor attention now appears firmly focused on the outlook for global trade and the chances of progress at the next round of talks between the US and China in Beijing. Protectionist measures have been heaping pain on many large economies, many of which are also grappling with a slowdown in growth.
“Markets have interpreted the fragments of information emanating from the trade talks positively, with risk assets starting to recoup recent losses,” said Nema Ramkhelawan-Bhana, an economist at FirstRand Bank Ltd. in Johannesburg. “Let’s hope that the positivity imbued in risk assets is not based on false optimism, especially as concerns over slowing global growth continue to mount.”
Elsewhere, Sweden’s krona gained after the Riksbank dropped its currency-intervention mandate. The British pound strengthened even after UK inflation fell below the Bank of England’s 2 percent target for the first time in two years. The New Zealand dollar surged after the central bank hinted at a less dovish policy path than many had expected.
These are the main moves in markets:
Stocks
The Stoxx Europe 600 Index increased 0.4 percent as of 7:00 a.m New York time to the highest in a week. Futures on the S&P 500 Index climbed 0.3 percent to the highest in more than 10 weeks. The MSCI All-Country World Index rose 0.2 percent. The UK’s FTSE 100 Index increased 0.4 percent. The MSCI Emerging Market Index gained 0.1 percent.

Currencies
The Bloomberg Dollar Spot Index rose less than 0.05 percent. The euro gained less than 0.05 percent to $1.1328. The British pound gained 0.4 percent to $1.2943, the biggest rise in almost three weeks. The Japanese yen decreased 0.1 percent to 110.64 per dollar, the weakest in almost seven weeks.

Bonds
The yield on 10-year Treasuries fell less than one basis point to 2.69 percent. Germany’s 10-year yield declined less than one basis point to 0.13 percent. Britain’s 10-year yield climbed less than one basis point to 1.189 percent, the highest in a week. Japan’s 10-year yield increased one basis point to -0.006 percent, the highest in almost two weeks.

Commodities
West Texas Intermediate crude rose 1.4 percent to $53.82 a barrel, the highest in a week on the biggest advance in more than a week. Gold gained less than 0.05 percent to $1,311.14 an ounce.