In European Equity Markets the pan-European Stoxx 600 closed up by 0.1%, having earlier risen as much as 2% in what was a choppy trading session. Most sectors and major bourses were in positive territory. Italian banks took a hit as shareholders balked at the possibility of even lower interest rates in Europe. Banco BPM, Ubi Banca and Unicredit fell 6%, 5% and 4% respectively. Airlines also declined, with British Airways parent IAG and Air France KLM shedding around 8% and Lufthansa falling 6.5%.
In Currency Markets the U.S. dollar fell to a fresh one-month low against a basket of currencies on Monday, as investors bet on the U.S. Federal Reserve easing policy in a bid to counter the negative impact from the spread of the new coronavirus. The dollar index, which measures the greenback’s strength against a basket of six other major currencies, was 0.44% lower at 97.543; after falling to a 1-month low of 97.296. On Monday, the euro was up 0.9% against the dollar.
In Commodities Markets oil prices rose over 2% on Monday, reversing an early fall to multi-year lows as hopes of a deeper cut in output by OPEC and stimulus from central banks countered worries about damage to demand from the coronavirus outbreak. Brent crude futures rose $1.16, or 2.3%, to $50.83 a barrel. The session low of $48.40 was its lowest since July 2017. U.S. West Texas Intermediate (WTI) crude futures rose $1.26, or 2.8%, to $46.02 a barrel. The session low of $43.32 a barrel was the lowest since December 2018.
In US Equity Markets indexes were slightly higher on Monday, as investors assessed the efficacy of further monetary stimulus amid the growing economic impact of the coronavirus outbreak. The S&P 500 was up 0.37%, at 2,965.25. The Nasdaq Composite rose 0.33%, at 8,595.79. Apple Inc rose 3.2%, recovering from a more than two-month low after Oppenheimer & Co upgraded the stock to “outperform”. China’s JD.com Inc rose 7.7% after it forecast at least a 10% rise in revenue for the first quarter, after posting better-than-expected quarterly results.
In Bond Markets U.S. Treasury prices rose sharply on Monday, pushing long-dated yields to fresh record lows, as bond investors braced for a slew of stimulus measures that include interest rate cuts from global central banks to ease the economic impact of the coronavirus. U.S. two-year yields also dropped, falling to a near four-year trough, with U.S. yield curves steepening as investors priced in easing from the Federal Reserve. U.S. 10-year yields fell to 1.080%, from 1.126% late on Friday. Earlier in the session, 10-year yields fell to a new record low of 1.03%.