LONDON (Reuters) - Stock markets and other riskier assets steadied on Thursday as investors dusted themselves down after a woeful week for the tech sector, readying for what was set to be the first quarterly drop in global equities in two years.
Banks and consumer stocks helped Europe’s main bourses 0.2-0.4 percent higher as the region built on a positive session for Asia’s heavyweight Nikkei, Hang Seng and Chinese markets.
For currencies traders, the dollar steadied too after a stronger-than-expected revision to Q4 growth data and hopes a nuclear standoff with North Korea has been averted gave it its largest daily gain in six months on Wednesday. [/FRX]
The tentative return of risk appetite and upcoming German inflation data also cooled safety plays like Bunds.
Benchmark yields - which move inversely to prices - on German government bonds crept back above 0.5 percent having been on a sharp slide for most of the month. Spanish yields meanwhile saw their biggest monthly fall since mid-2016. [GVD/EUR]
The 10-year U.S. Treasury yield was at 2.773 percent after touching a near two-month low of 2.743 percent overnight amid the strains on Wall Street.
“I think most of these markets are staring at the 200-day moving average on the S&P 500 to see if it breaks,” said Societe Generale’s Kit Juckes.
“We will see if German CPI numbers (due at 1200 GMT) surprise on the upside... but I think if there is going to be another surprise in Q2 it will be yen strength again.”
Wall Street futures were pointing to a marginally higher open. [.N]
All three major U.S. indexes ended in the red again on Wednesday with $30 billion wiped off Amazon’s shares alone after reports U.S. President Donald Trump wanted to rein in the firm’s power in online retailing.
As a set, the FAANGs (Facebook, Amazon, Apple, Netflix and Google) are still well up for the quarter, but privacy concerns after it was revealed 50 million Facebook users’ data was misused has wiped over $400 billion off the shares’ value in recent weeks.
The turbulent start to 2018 in financial markets has brought an end to one of the longest ever quarterly bull runs - and there have been few places to hide.
Investors have had it all thrown at them, from the biggest ever rise in stock volatility to rapidly escalating tensions over global trade, deepening turmoil in the White House and major tech sector wobbles.
A “melt-up” that sent the MSCI’s world share index up 8 percent in January suddenly melted away. Now the Dow Jones, S&P 500, FTSE Nikkei and scores of other big markets are all down for the year.
“We have got to