Shares extend bear market rise as inflation rages through Reuters

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© Reuters. File image: Tokyo, February 25, 2022 Pedestrians wearing safety masks on an electronic board showing the stock prices of various companies outside a brokerage firm in Tokyo, Japan. REUTERS / Kim Kyung-Hoon

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By Danilo Masoni and Kevin Buckland

MILAN / TOKYO (Reuters) – Global stocks extended their bounce on Monday as strong Wall Street closed on Friday as non-peak oil prices helped ease sentiment and allay fears of prolonged inflation.

Strong morning gains in Europe and a rally across Asian markets after China further relaxed the Covit-19 restrictions lifted the MSCI benchmark for global stocks to a third consecutive session, rising 0.5% to 0851 GMT.

Investors hope that the fall in oil prices from the three-month high in early June will ease price pressures and allow the US Federal Reserve to ease the risk of a recession and tighten a less aggressive policy than initially feared.

“As the economic downturn eases demand in the United States, Europe and China, we think oil prices are more likely to fall. This will help lower expectations on inflation this year,” said Jerome Schup, prime partners finance manager in Geneva.

“The next central bank meeting in July will be very important. We should see the central bank continue to raise rates to 75 basis points. But (Fed chairman Jerome) Powell’s new message is very important. Maybe they can tell. Said.

Despite a strong three-day recovery that helped the MSCI further increase the global benchmark distance than the November 2020 low earlier this month, the index is down more than 20% from its record-high end in January, a commonly described fall. A bear market.

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Traders said selling market conditions and month-end portfolio restructuring also contributed to the bounce, however, expecting more volatility as the second quarter earnings seasons approach.

The broadest index of Asia-Pacific shares of MSCI rose 1.6%. Beijing said on Saturday it would allow schools to resume classes in person, and after the city reported zero new local lawsuits for the first time in two months, Shanghai’s top party boss declared victory against COVID-19.

China’s easing of sanctions has boosted oil stocks and miners, adding more than 1% to the Pan-regional standard. Meanwhile, the US stock index futures extended their gains by about 0.6%.

Oil is volatile amid the economic downturn and concerns about lost Russian supplies amid sanctions for the Ukraine conflict.

Prices rose 0.2% to $ 113.36 a barrel, while the US West Texas intermediate futures fell 0.1% to $ 107.52.

It was over 3% as traders eliminated bets for next year’s hike, but this year has seen more thinking about aggressive austerity. They were up 2 basis points at 3.16%, an 11-year high earlier this month.

“The market is focused on policy exchange between high inflation and hard-to-land fears,” Westback rate strategist Damien McCollo wrote in a note.

“There will be ongoing discussions on whether long-term yields will peak, although we do not yet expect 10-year yields to fall below 3% materially or consistently,” he added.

The dollar continued to consolidate at a very low level from the middle of the month against key allies as traders reevaluated the prospects for a rise in the aggression rate.

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Measuring the currency against six rivals – it was down 0.2% at 103.82.

Gold rose 0.7% to $ 1,838.8 an ounce, backed by news from some Western countries that plan to officially ban metal imports from Russia in the run-up to the invasion of Ukraine.

The flat traded at $ 21,170.88, down from $ 17,588.88 earlier this month.

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