GLOBAL MARKETS-Stocks, dollar pause their climbs; lira locked in tailspin

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* Brent crude $80 . under the pressure of

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* Turkey nears currency collapse as Cenbank prepares to cut rates

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* Dollar, stocks rallied after hot November so far

*European gas prices up 60% this month

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* Graphic: Global Asset Display

* Graphic: World FX Rates

LONDON/SYDNEY, Nov 18 (Businesshala) – World stock markets and the dollar rallied on Thursday, slipping on talk of a coordinated release of oil reserves, while Turkey’s lira was at stake again, its central bank later the economy. would defy the logic of and reduce interest rates.

Oil prices slipped below $80 a barrel overnight, with both the United States and China indicating they could tap into their fuel reserves, but Europe’s inflation pressures showed signs of easing as Nord Stream 2 Gas prices were up 60% in November amid wrangling over the pipeline. ,

That and the fact that the euro was finally getting some respite from the dollar in currency markets meant that the record-high STOXX 600 equity index was struggling early after 19 gains over the past 17 sessions.

In emerging markets, Turkish lira was flirting with a fall of $ 11 per dollar. The currency has plunged more than 25% this year as inflation soared to 20% and pressure from the country’s President Tayyip Erdogan in recent days has dashed hopes that the central bank will raise interest rates by at least 100% by 1100 GMT. will decrease the basis points.

“The main thing that drives the lira these days is what President Erdogan says and it seems that recently he has decided to let it go,” said Vladimir Demishev, a senior interest rate trader at Sova Capital. What would happen afterwards with rates changing throughout the week.

S&P 500 futures were meanwhile up 0.3% as the index fell on Wednesday after retail giant Target warned that three-decade high US inflation was putting pressure on profit margins.

“We seem to have stalled somewhat,” said Jun Bei Liu, a portfolio manager at Tribeca Investment Partners in Sydney.

“Investors are probably taking a little break,” she said, in the wake of a strong US results season, but in the form of macroeconomic headwinds in the form of inflation and China’s slowdown.

Japan’s Nikkei closed down 0.3% overnight in Asia. MSCI’s broadest index of Asian shares outside Japan fell 0.5%, mostly dragged by weakness in Hong Kong tech stocks as Chinese heavyweight Alibaba fell more than 5%.

Ant Group and SoftBank-backed payments firm Paytm also suffered for the first time in India, with shares falling 21% below listing price in their first session.

Meanwhile, safe-haven assets are hanging on for most of Wednesday’s good gains. The yen, which a day earlier posted its sharpest one-day slump in three months, hovered at 114.18 per dollar as the greenback’s rally halted.

Gold held steady at $1,864 an ounce. The benchmark 10-year Treasury yield also settled at 1.5906% after falling nearly 5.5 basis points on Wednesday. Germany’s 10-year yield, Europe’s benchmark, was down 2 basis points at -0.26% but inflationary pressures were still visible.

The inflation-linked 10-year Bund yield was a fresh record low — the yield moves inversely to the price — and the near-term five-year, five-year forward inflation gauge hovered just under 2%.

Indicating a split among European Central Bank policymakers, board member Isabel Schnabel said on Wednesday that the central bank should be prepared to rein in inflation if it proves to be more stubborn than expected.

big dollar

The US dollar is bullish against a backdrop of apparent caution, as US data has turned surprisingly strong, raising doubts over the outlook for other major economies.

In contrast, Europe is grappling with a wave of COVID-19 cases and new restrictions to contain it, while the central bank is pressing to raise rates.

The euro recovered from a trip below $1.13 but remained volatile on Thursday at $1.1317. It is also for the dollar versus its worst month since June, when the Federal Reserve surprised investors with a sharp change in tone.

Currency traders are also anticipating a sharp downdraft in the Aussie/Yen cross, which is often a barometer of sentiment. It fell from its 200-day moving average on Tuesday and is down nearly 4% in a dozen sessions.

“You have the perfect storm for bears,” said Matt Simpson, senior analyst at brokerage City Index. “Basically and technically the Aussie/Yen looks great with low oil prices.”

Reporting by Tom Westbrook in Sydney Editing by Mr Navratnam and Sam Holmes


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