NEW YORK, June 30 — Global shares edged lower yesterday, as new coronavirus outbreaks in Asia vied with strong US and European consumer confidence, and investors speculated about whether the Federal Reserve would accelerate its timetable to end easy monetary policy.
The US dollar rose to a one-week peak on safe-haven buying stoked by fears that the highly contagious Delta variant could derail a burgeoning economic recovery.
MSCI’s all country world index, which tracks shares across 50 countries, shed 0.06 per cent, as declines in Asian equities undercut new highs in U.S and European markets.
The Nasdaq closed at a record high, boosted by technology stocks and a government survey showing US consumer confidence in June hit its highest level since the pandemic started.
European shares ended higher after data there showed economic sentiment hit a 21-year high in June. The pan-European STOXX 600 index closed 0.3 per cent higher at 456.37 points.
Still, MSCI’s broadest index of Asia-Pacific shares outside Japan closed 0.55 per cent lower, Japan’s Nikkei lost 0.81 per cent, and Chinese stocks lost 0.92 per cent.
Investors are worried about the economic impact of the highly infectious Delta variant. Indonesia, Malaysia, Thailand and Australia are all battling outbreaks and tightening restrictions, and Spain and Portugal announced restrictions for unvaccinated British tourists.
“These are headwinds to risk assets performing well, but if we step back, we are still looking at equity indices that continue to hit all time highs,” said Patrick Leary, chief market strategist and senior trader at Incapital.
Investors are also waiting for the US jobs due out on Friday, the results of which could influence Fed policy.
Economists polled by Reuters are expecting a gain of 690,000 jobs for June, up from 559,000 in May.
On Monday, Richmond Federal Reserve President Thomas Barkin said the US central bank has made “substantial further progress” toward its inflation goal in order to begin tapering asset purchases.
“A good number will speed up the debate about tapering asset purchases soon and raising rates sooner,” Leary said.
Unofficially, the Dow Jones Industrial Average rose 20.24 points, or 0.06 per cent, to 34,303.51, the S&P 500 gained 2.05 points, or 0.05 per cent, to 4,292.66 and the Nasdaq Composite added 28.67 points, or 0.2 per cent, to 14,529.17.
The Nasdaq was boosted by Apple Inc, while the S&P was helped by Morgan Stanley’s news late Monday that it would double its dividend.
Germany’s DAX added 0.9 per cent, after Adidas lifted the German index with news of a share buy back plan.
The US dollar rose to a one-week peak. The dollar index , which tracks the greenback versus a basket of six currencies, rose 0.2 per cent to 92.077, with the euro down 0.19 per cent to US$1.19 (RM4.94).
Sterling was last US$1.3849, down 0.24 per cent. The Australian dollar fell 0.71 per cent versus the greenback at US$0.751.
Oil prices rose as hopes for a demand recovery persisted despite new outbreaks of the Delta variant.
Brent crude futures settled up 8 cents, or 0.11 per cent, and US crude settled up 7 cents, or up 0.10 per cent.
Spot gold dropped 1.0 per cent to US$1,760.77 an ounce. US gold futures fell 1.06 per cent to US$1,761.00 an ounce.
Yields for benchmark 10-year US Treasuries were last up less than a basis point at 1.4816 per cent.
Germany’s 10-year bond yield was up 1 basis point at -0.173 per cent. — Reuters
