(Bloomberg) — European stocks rallied with U.S. equity futures after a brutal sell-off in Chinese equities halted on Tuesday while investors gauged the latest efforts to contain the deadly coronavirus. Treasuries fell with gold.
The Stoxx Europe 600 Index’s advance was led by mining and energy shares as 18 of 19 industry sectors rose. BP Plc jumped after an earnings beat. Equities rebounded from Shanghai and Hong Kong to Seoul and Taipei in the wake of a record $720 billion wipeout in China on Monday. The offshore yuan recouped the previous session’s decline while the yen weakened. West Texas oil rose after a four-day retreat. A gauge of the dollar held most of its Monday gain, the biggest since September.
Investors are weighing China travel restrictions and business shut-downs alongside measures Beijing is introducing to support growth as the hit to the country’s economy mounts. The latest China death toll from the virus is 425, while the number of cases has risen to almost 20,500. Macau is asking casinos in the world’s biggest gaming hub to shut down for half a month as part of efforts to contain the spread.
Elsewhere, Australia’s dollar climbed after the central bank highlighted the impact of past interest-rate cuts, while saying it’s too early to tell what the duration of the effect from the coronavirus will be.
Meanwhile, traders are also waiting for the outcome of the Iowa Caucuses, as the 2020 Democratic presidential race kicks off. Problems with the reporting process have delayed the results.
Here are some key events coming up:
The U.S. Democratic Party of Iowa on Tuesday will release results from caucuses, the opening event of its nomination race for the presidency.Euro-zone PMI data in its final version will be released Wednesday.The Reserve Bank of India’s interest rate decision is due Thursday.The U.S. employment report for January is set for Friday release.
These are the main moves in markets:
Stocks
The Stoxx Europe 600 Index jumped 1% as of 9:27 a.m. London time.Futures on the S&P 500 Index rose 1%.Nasdaq 100 Index futures gained 1.1%.The MSCI All-Country World Index rose 0.4%.The MSCI Asia Pacific Index surged 1.1%.
Currencies
The Bloomberg Dollar Spot Index dipped 0.1%.The British pound was little changed at $1.2992.The euro was little changed at $1.1056.The Japanese yen weakened 0.3% to 109.05 per dollar.The offshore yuan strengthened 0.3% to 6.9938 per dollar.
Bonds
The yield on 10-year Treasuries gained five basis points to 1.58%.Germany’s 10-year yield rose three basis points to -0.41%.Britain’s 10-year yield gained three basis points to 0.547%.
Commodities
West Texas Intermediate crude surged 1.9% to $51.08 a barrel.Gold weakened 0.6% to $1,567.25 an ounce.LME copper surged 2.7% to $5,676 per metric ton.
–With assistance from Ranjeetha Pakiam and Andreea Papuc.
To contact the reporter on this story: Todd White in Madrid at twhite2@bloomberg.net
To contact the editor responsible for this story: Sam Potter at spotter33@bloomberg.net
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