{"id":20737,"date":"2023-06-10T00:08:36","date_gmt":"2023-06-10T04:08:36","guid":{"rendered":"https:\/\/ifintechworld.com\/uncategorized\/shares-rise-treasury-yields-fall-as-us-jobless-claims-surge\/"},"modified":"2023-06-10T00:08:37","modified_gmt":"2023-06-10T04:08:37","slug":"shares-rise-treasury-yields-fall-as-us-jobless-claims-surge","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=20737","title":{"rendered":"Shares rise, Treasury yields fall as US jobless claims surge"},"content":{"rendered":"
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\u00a9 Reuters. FILE PHOTO: A man walks past an electric monitor displaying Japan’s Nikkei share average and recent movements, outside a bank in Tokyo, Japan, June 5, 2023. REUTERS\/Issei Kato<\/span>
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By Marc Jones and Koh Gui Qing<\/p>\n

NEW YORK\/LONDON (Reuters) – World stocks rose on Thursday and Treasury yields edged lower as investors leaned toward bets that the U.S. Federal Reserve is likely to abstain from raising interest rates next week.<\/p>\n

This view was bolstered by Thursday’s data showing the number of Americans filing new claims for unemployment benefits surged to their highest in over 1-1\/2 years.<\/p>\n

On Wall Street, the jumped 0.62%, the added 0.5% and the jumped 1.02%.<\/p>\n

The pan-European benchmark index was flat, while Asian markets struggled overnight. MSCI’s broadest index of Asia-Pacific shares outside Japan edged up just 0.1%. Still, helped by gains on Wall Street, the MSCI’s broadest index of world stocks rose 0.51% to hover under a 13-month high.<\/p>\n

“The ultimate question for risk markets is whether the Fed might follow up with a hike of their own next Wednesday or whether they’ll finally keep rates on hold after a relentless hiking pace,” said Stephen Innes, managing partner at SPI Asset Management.<\/p>\n

Judging by recent comments from the Fed’s leadership, Innes said the U.S. central bank has shown its preference for pausing rate hikes right now.<\/p>\n

The Treasury market seemed to agree, as yields tumbled on concerns that the spike in new U.S. jobless benefits claims suggested a potential recession could be on the horizon.<\/p>\n

The two-year Treasury yield, a barometer for where the market perceives future Fed policy, edged down to 4.5085%, while the yield on benchmark 10-year notes slid to 3.712%.<\/p>\n

The spread of the Treasury yield curve based on two- and 10-year notes was at -79.6 basis points. An inverted curve, with shorter-dated debt yielding more than longer-dated debt, is considered a harbinger of a recession. <\/p>\n

At the same time, some analysts warned against thinking that rate hikes are over.<\/p>\n

In an almost carbon copy of a surprise rate rise in Australia this week, Canada caught markets off guard on Wednesday by hiking interest rates to a 22-year high of 4.75% due to an overheating economy and stubbornly high inflation.<\/p>\n

“The main theme to everything out there is the bond sell-off and the realisation that the pause (in the rate hiking cycles of central banks) doesn’t mean the end,” said Societe Generale (OTC:) strategist Kit Juckes.<\/p>\n

“We are definitely repricing rate expectations higher,” he added, explaining that traders were also questioning the long-held view that the Fed would end its rate hike cycle well before the European Central Bank.<\/p>\n

The Fed, ECB and Bank of Japan all have interest rate decisions next week, causing most traders to shy away from any major buying or selling.<\/p>\n

Lower Treasury yields weighed on the dollar, which fell 0.69% after hitting a three-month high last week. It has risen more than 2.5% against the world’s other top currencies over the last month. <\/p>\n

Markets are pricing in a 64% chance of the Fed standing pat next week, compared with 78% just a day earlier, the CME FedWatch tool showed. Traders largely expect a 25 basis point hike in July though.<\/p>\n

TRYING TIMES <\/p>\n

Japan’s yen strengthened 0.9% to 138.93 per dollar after revised data showed the economy grew more than initially thought in January-March.<\/p>\n

The euro rose 0.78% above $1.07 again, while the Canadian dollar consolidated gains from the Bank of Canada’s surprise hike.<\/p>\n

“The RBA and Bank of Canada have put the cat among the pigeons a bit,” said CMC Markets strategist Michael Hewson. “Rate cuts are being repriced. They are being pushed back from the end of this year into next year.” <\/p>\n

In commodity markets, oil slipped with both and futures falling over 1.5% to $75.63 and $70.97 per barrel respectively on the day. Traders said a larger-than-expected rise in U.S. gasoline inventories had raised concerns about demand. <\/p>\n

Gold prices steadied following a 1% drop in the previous session, with up 1.3% at $1,964.08 an ounce. <\/p>\n

In emerging markets, inched to another record low. The lira nosedived 7% on Wednesday on signs that Tayyip Erdogan’s newly re-elected government is abandoning an 18-month strategy of keeping the currency on a tight leash. <\/p>\n

(Aditional reporting by Ankur Banerjee in Singapore; Editing by Toby Chopra, Mark Potter, Richard Chang and Marguerita Choy)<\/p>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u00a9 Reuters. FILE PHOTO: A man walks past an electric monitor displaying Japan’s Nikkei share average and recent movements, outside a bank in Tokyo, Japan, June 5, 2023. REUTERS\/Issei Kato By Marc Jones and Koh Gui Qing NEW YORK\/LONDON (Reuters) – World stocks rose on Thursday and Treasury yields edged lower as investors leaned toward […]<\/p>\n","protected":false},"author":1,"featured_media":20738,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"video","meta":{"footnotes":""},"categories":[1],"tags":[83],"class_list":["post-20737","post","type-post","status-publish","format-video","has-post-thumbnail","hentry","category-uncategorized","tag-featured","post_format-post-format-video"],"yoast_head":"\nShares rise, Treasury yields fall as US jobless claims surge | iFintechWorld<\/title>\n<meta name=\"description\" content=\"\u00a9 Reuters. 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