© Reuters. FILE PHOTO: A man walks past a stock listing meeting at a brokerage in Tokyo, Japan.
By Kevin Buckland (Reuters) – Global stocks held firm near record highs on Friday as the reversal of inflation fears in the United States pushed bond yields lower and lifted Wall Street, though weakness in Chinese stocks limited gains in Asia. MSCI’s broader gauge of world stocks set a record early in the Asian session and last time it was almost unchanged. Japan gained 0.6% and Australian stocks held near a more than a year high, while South Korea’s Kospi hit the highest intraday level since mid-February. Chinese stocks were an outlier, with the CSI 300 falling 1.3%, pushing the MSCI Asia ex-Japan index down 0.4%, not helped by concerns about increased tension between Washington and Beijing. Benchmark 10-year Treasury yields held near Thursday’s two-week low near 1.6%, which had boosted US tech stocks and fueled the all-time close. Yields had risen to their highest level since January last year at 1,776% at the end of March, as a series of strong economic data from the US fueled concerns about a surge in inflation that could force the Fed. Federal to raise interest rates sooner than politicians have done so far. indicated. However, an unexpected increase in the number of Americans filing new applications for unemployment benefits, along with Fed Chairman Jerome Powell’s reiteration Thursday that inflation was not a concern, helped calm the nerves of the bond market. “Markets appear to have taken comfort in the fact that they may have overstated concerns about inflation and therefore rising interest rates,” said Michael McCarthy, chief market strategist at CMC Markets. “At the moment, there is no question that the sentiment is tremendously positive and I am not going to get in the way of this train.” Powell pointed out at an International Monetary Fund event that the central bank is nowhere near reducing support for the US economy, and said that while the economic reopening could result in temporarily higher prices, it will not constitute inflation. Helped by the decline in yields, traders piled on mega-cap tech stocks like Apple Inc (NASDAQ :), Microsoft Corp (NASDAQ 🙂 and Amazon.com Inc (NASDAQ :), which were the main drivers of the S&P 500. The S&P 500 gained 0.42% to a record high, while adding 1.03%. Emini futures pointed to a further rise, rising 0.1% on Friday. “The movement in the (stock) market was based on rates,” said Thomas Hayes, president of Great Hill Capital. “As long as rates remain compressed, there is a bet on the power of long-term earnings, which materialized in the rally in technology. The, which tracks the dollar against six rivals, held close to Thursday’s two-week low below 92, weighed down by lower Treasury yields. It fell to around $ 1,752 an ounce after jumping to a more than one-month high of $ 1,758.45 on Thursday. Crude oil prices changed little, as the Wall Street rally and a weak dollar offset concerns that a big jump in US gasoline stocks rose 0.15% to $ 59.69 a barrel. , while it fell slightly to 63.16 dollars a barrel.