World shares were mixed on Monday as worries over the pandemic clouded the outlook for a recovery from the coronavirus crisis.
Banks made solid gains as bond yields ticked higher
World shares were mixed on Monday as worries over the pandemic clouded the outlook for a recovery from the coronavirus crisis.
Tokyo and Paris advanced, while Frankfurt and London were almost unchanged. Benchmarks fell in Hong Kong and Shanghai and US futures were mixed.
Government precautions to battle surging outbreaks point to an uneven global recovery, economists say. That's especially true for tourism, an important industry for many parts of the region.
But investors have generally taken in stride recent setbacks as Covid-19 infections have come roaring back in Japan, Thailand, and India, among other countries.
“One thing is for sure, markets have priced in the pandemic as a sprint and not a marathon. That premise could come under stress in the weeks to come, although I sorely hope I am completely wrong on this front," Jeffrey Halley of Oanda said in a commentary.
“Pandemic nerves are likely to be drowned out this week as it progresses as the pace of the data calendar picks up," he said.
Germany's DAX edged less than 0.1 per cent lower to 15,272.86 and the CAC 40 in Paris inched 0.1 per cent higher to 6,261.50. The FTSE 100 in London was nearly unchanged at 6,938.5. The future for the S&P 500 slipped 0.1 per cent while the contract for the Dow industrials was nearly unchanged.
In Asian trading, Tokyo's Nikkei 225 added 0.4 per cent to 29,126.23 and the Hang Seng in Hong Kong fell 0.4 per cent to 28,952.83. In Seoul, the Kospi jumped 1 per cent to 3,217.53. The Shanghai Composite index dropped 1 per cent to 3,441.17 and Australia's S&P/ASX 200 slipped 0.2 per cent to 7,045.60.
India's Sensex climbed 0.9 per cent to 48,318.57, even as authorities reported newly confirmed coronavirus cases hit a daily high on Sunday, topping 352,000.
On Friday, the benchmark S&P 500 rose 1.1 per cent to 4,180.17. The Dow Jones Industrial Average rose 0.7 per cent to 34,043.49. The tech-heavy Nasdaq climbed 1.4 per cent to 14,016.81, while the Russell 2000 index of small caps rose 1.8 per cent to 2,271.86.
Wall Street has been in rally mode in recent weeks as the rollout of Covid-19 vaccinations, the massive support from the US government and Federal Reserve, and a string of encouraging economic data fuel expectations for a stronger economy and solid corporate profit growth this year.
Banks made solid gains as bond yields ticked higher. That allows them to charge more lucrative interest on loans. The yield on the 10-year Treasury rose to 1.58 per cent from 1.56 per cent late Friday.
About a quarter of S&P 500 companies have reported quarterly results so far this earnings season. Of these, 84 per cent have delivered earnings that topped Wall Street's estimates, according to FactSet.
While corporate earnings have been mostly positive, investors are weighing stronger economic growth against threats from the pandemic and worries about potential changes in US tax policy to help pay for support for the recovery and massive infrastructure spending.
This week is another busy one for earnings, with 181 S&P 500 companies, including Tesla, Starbucks, Microsoft, and Amazon.com, set to report results.
Meanwhile, the price of Bitcoin jumped 5.1 per cent to $52,644.71. It dropped about 2 per cent to $50,675 Friday, according to the tracking site CoinDesk. The cryptocurrency had traded for as much as $63,000 as recently as last week.
In another trading, US benchmark crude oil lost $1.14 to $61.00 per barrel in electronic trading on the New York Mercantile Exchange. It picked up 71 cents to $62.14 per barrel on Friday. Brent crude, the international standard, dropped $1.82 to $64.29 per barrel.
The US dollar slipped to 107.70 Japanese yen from 107.93 yen. The euro rose to $1.2102 from $1.2094.