European shares climb, yen stumbles and euro shines By Reuters

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<span>© Reuters. A woman looks at monitors showing stock information at a brokerage house in Jiujiang, Jiangxi province, China June 19, 2018. REUTERS/Stringer </span><br />
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<p>By Nell Mackenzie and Wayne Cole</p>
<p>LONDON/SYDNEY (Reuters) – European shares climbed on Wednesday as surprisingly upbeat U.S. economic news eased global growth concerns, while the embattled yen hit a 15-year low against the euro and Japan hinted at intervention to prevent further losses.</p>
<p>Treasury yields inched higher on the strength of U.S. data, combined with hawkish commentary emerging from Portugal at a gathering of central bank heavyweights including Federal Reserve Chair Jerome Powell, European Central Bank head Christine Lagarde and Bank of Japan Governor Kazuo Ueda. </p>
<p>European inflation and rate hike hints from Portugal were the focus for Tim Graf, head of EMEA macro strategy at <span itemscope="" itemtype="http://schema.org/Corporation"><span itemprop="name"> State Street </span></span> (NYSE:) Global Advisors. </p>
<p>“Unless you get some big exogenous shock between now and the next ECB meeting, they’re going to hike rates again,” he said.</p>
<p>Across the Atlantic, the U.S. economy continues to show resilience in the face of tighter monetary conditions, he added. </p>
<p>“Recession probability models in the U.S. project a 55-70% to 65-70% probability we’ll get a recession in the next 12 months. But we’ve been hearing this for the last 12 months, and it’s not here,” said Graf. </p>
<p>A broader bullish sentiment helped MSCI’s broadest index of global shares tick up 0.2%. at 0845 GMT. </p>
<p>U.S. money market futures now imply around a 77% chance of a hike to 5.25-5.5%, and slightly more risk of a further move to 5.5-5.75%, which nudged short-term Treasury yields higher.</p>
<p>In equities, U.S. stock futures eased, with those on the down 0.2% and those on the down 0.5%, after a Wall Street Journal report that Washington was considering new restrictions on exports of artificial intelligence chips to China.</p>
<p>The report knocked Nvidia (NASDAQ:) 4% lower in the premarket on Wednesday. </p>
<p>EURO ON THE RISE</p>
<p>Bond yields also moved sharply higher in Europe after a bevy of central bankers sounded hawkish on inflation and warned rates would likely have to stay higher for longer.</p>
<p>Markets imply a 90% probability of an ECB rate hike to 3.75% in July and a peak around 4.0%.</p>
<p>That underpinned the euro at $1.0954, while keeping it near a 15-year peak of 157.98 yen. </p>
<p>The dollar had hit a near eight-month top of 144.18 yen, before easing back to 143.85 as Japanese officials again protested against the yen’s weakness.</p>
<p>Japan’s top currency diplomat Masato Kanda on Wednesday warned against further falls in the yen, saying authorities would take an appropriate response if moves became excessive.</p>
<p>Markets are wary in case Japan intervenes to buy the yen as it did last October, which knocked the dollar down from 151.94 to as low as 144.50 in a matter of hours.</p>
<p>Yet a rally in the yen looks unlikely while the Bank of Japan maintains its super-easy monetary policy, analysts said.</p>
<p>“Following BOJ Governor Ueda’s consistently dovish message and weak Japanese wage growth, market participants now lack the conviction the BOJ will soon tighten its monetary policy,” said Carol Kong, a currency strategist at CBA.</p>
<p>“So we now see a higher risk Japanese authorities will step into the market to prop up the JPY.”</p>
<p>In commodities, gold hovered at a three-month low of $1,909 an ounce, after finding support at the recent three-month low of $1,909.99. [GOL/]</p>
<p>Oil prices edged up after data showed a larger-than-expected draw in and gasoline inventories, but they remain uncomfortably close to lows for the year so far. [O/R]</p>
<p> dropped about a dollar after earlier highs to $71.92 a barrel, while U.S. crude fell 0.5% cents to $67.33. </p>
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<br /><a href="https://www.investing.com/news/economy/asia-shares-hesitant-yen-slide-stokes-intervention-risk-3114822">Source link </a></p><p>The post <a href="https://forextraderhub.com/european-shares-climb-yen-stumbles-and-euro-shines-by-reuters.html">European shares climb, yen stumbles and euro shines By Reuters</a> first appeared on <a href="https://forextraderhub.com">Forex Trader Hub</a>.</p>