Wall St jumps early after recent selloff; yen drops vs dollar

  • US stocks sharply higher in early NY trade
  • US Treasury yields rise
  • Yen plunges against dollar
  • Crude oil higher

NEW YORK, June 21 (Reuters) – Stocks on global indexes rose sharply on Tuesday, with Wall Street bouncing following its recent selloff, while the Japanese yen fell against the US dollar to its lowest level since October 1998.

US stock indexes climbed as investors returned from a long weekend, with mega-cap growth and energy companies up sharply. read more

Expectations of interest rate hikes from major central banks and worries about a global recession have kept investors on edge. Central banks are expected to tighten policy to combat high inflation.

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The Dow Jones Industrial Average (.DJI) rose 593.18 points, or 1.98%, to 30,481.96, the S&P 500 (.SPX) gained 98.72 points, or 2.69%, to 3,773.56 and the Nasdaq Composite (.IXIC) added 355.18, or 3.29 %, to 11,153.53.

The pan-European STOXX 600 index (.STOXX) rose 0.44% and MSCI’s gauge of stocks across the globe (.MIWD00000PUS) gained 2.12%.

“The market already in a sense may have priced in a shallow recession…You had negative GDP in Q1, so it is possible that the second quarter is negative, in which case the recession could potentially be in the rear-view mirror, ” said Thomas Hayes, managing member of Great Hill Capital in New York.

All eyes are now on Fed Chair Jerome Powell’s testimony to the Senate Banking Committee on Wednesday for clues on rates.

Goldman Sachs has said it now thinks there is a 30% chance of the US economy tipping into a recession over the next year, up from its previous forecast of 15%. read more

In the foreign exchange market, the Japanese yen plunged against the US dollar to its lowest level in almost 24 years at 136,330 per dollar. read more

Japanese Prime Minister Fumio Kishida said the central bank should maintain its current ultra-loose monetary policy. This makes it an outlier among other major central banks. read more

US Treasury yields were slightly higher as the risk-off mode that weighed on US markets last week took a breather.

Benchmark 10-year yields were at 3,297%, up from their 3,239% close at the end of last week.

US crude recently rose 2.35% to $112.13 per barrel and Brent was up to $115.98, up 1.62% on the day.

Spot gold added 0.1% to $1,839.80 an ounce.

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Additional reporting by Elizabeth Howcroft in London; also by Devik Jain and Anisha Sircar; Editing by Louise Heavens, Chizu Nomiyama and Mark Heinrich

Our Standards: The Thomson Reuters Trust Principles.

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