World shares dip after hitting record highs; U.S. yields rebound

* Reuters Live Markets blog: (Updates to U.S. market close)

By Rodrigo Campos

NEW YORK, April 19 (Reuters) - An index of stocks across the world on Monday posted its largest daily drop in almost four weeks after touching a record high as investors looked for earnings to justify the high valuations in equities.

The U.S. dollar index touched a more than 6-week low and Treasury yields edged up after posting on Friday their largest weekly drop since June and oil prices slipped on concerns over rising coronavirus cases globally.

On Wall Street, indexes fell, with the Nasdaq .IXIC being the biggest decliner.

The Dow Jones Industrial Average .DJI fell 123.04 points, or 0.36%, to 34,077.63, the S&P 500 .SPX lost 22.21 points, or 0.53%, to 4,163.26 and the Nasdaq Composite .IXIC dropped 137.58 points, or 0.98%, to 13,914.77.

"Wall Street could be in for a few choppy trading weeks as more of the same strong earnings beats becomes the theme," Edward Moya, senior market analyst at OANDA, said in a note. "U.S. stocks appear to have hit a top as all the good news from corporate America has been mostly priced in and as the pause in rising yields continues."

MSCI's gauge of stocks across the globe .MIWD00000PUS shed 0.28%, its largest daily drop since March 24.

The pan-European STOXX 600 index .STOXX lost 0.07% and Emerging market stocks lost 0.01%. MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.12% higher. Nikkei futures NKc1 lost 1.48%.

The dollar fell against a basket of peers on the back of the sharp drop in Treasury yields last week.

"Indeed, the USD rally is all but distant memory by now and the currency's underperformance seems to reflect the apparent divergence in the outlook between the slumping UST yields and the rather perky bond yields elsewhere," said Valentin Marinov, head of G10 FX research at Credit Agricole.

The dollar index =USD fell 0.564%, with the euro EUR= up 0.42% to $1.2033.

The Japanese yen strengthened 0.55% versus the greenback at 108.15 per dollar, while sterling GBP= was last trading at $1.3987, up 1.14% on the day, as traders bet on the British economy reopening amid the COVID-19 pandemic.

Treasury yields rose after last week's sharp drop.

"Yields are taking their cues from the equity markets," said Jim Barnes, director of fixed income for Bryn Mawr Trust.

He and others said investors are also waiting to gauge the market's appetite for $24 billion of 20-year bonds scheduled to be auctioned on Wednesday.

Benchmark 10-year notes US10YT=RR last fell 10/32 in price to yield 1.6064%, from 1.573% late on Friday.

Spot gold XAU= dropped 0.3% to $1,770.26 an ounce. Silver XAG= fell 0.56% to $25.81.

Bitcoin BTC=BTSP last fell 0.14% to $56,202.89.

Oil prices edged up, but rising COVID-19 infections in India prompted concern than stronger measures to contain the pandemic would hurt economic activity.

A weaker dollar makes oil cheaper for holders of other currencies. However, COVID-19 cases have surged in India, the world's third-biggest oil importer and consumer, dampening optimism for a sustained global recovery in demand.

"The primary hazard to continued oil price strength is the possible re-emergence of COVID-19 case counts on a broad scale," said Jim Ritterbusch, president of Ritterbusch and Associates.

U.S. crude CLc1 rose 0.43% to $63.40 per barrel and Brent LCOc1 was at $67.09, up 0.48% on the day.

Global assets Link
Global currencies vs. dollar Link
MSCI All Country Wolrd Index Market Cap Link
Emerging markets Link

Reporting by Rodrigo Campos; additional reporting by Medha
Singh and Shivani Kumaresan in Bengaluru, Devika Krishna Kumar,
Herbert Lash and David Henry in New York and Ross Kerber in
Boston; Editing by Alex Richardson, Will Dunham and Richard

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.