Global stocks jump, dollar falls, as rate cut whispers rumble

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Global stocks jump, dollar falls, as rate cut whispers rumble

On Friday, the 7th of June 2019, a gauge of major global stocks climbed higher, while US treasury yields were plunged alongside American dollar following reveal of a US Labor Department data showing a sharp slowdown in US Job growth, fueling the hopes of an imminent interest rate cut.

Aside from that, a US-Mexico deal over illegal immigrant issue that averted a catastrophic tariff conflict between the two neighboring countries, had also added to the ongoing bullish bias over the global equity markets, while American dollar fell for the second consecutive day over growing optimism of a rate cut.

Followed by the reveal of US Labor Department’s job data, which had also shown a waning wage growth, US dollar index measured against a basket of six major currencies in an average posted a plunge of 0.44 percent to settle at 96.56.

Besides, the American dollar had also dropped by 1.06 percent this week, its largest weekly decline since early-February 2018. Expressing market’s anticipation towards anything that could prompt an interest rate cut, a chief investment officer at Cresset Capital Management in Chicago, Jack Ablin said, “Right now the market is willing to accept disappointing growth in exchange for the prospect of lower rates”.

Citing statistics, on Wall St., Dow and S&P had posted their biggest weekly gain since last November, while on the other side of the Atlantic, regional Pan-European STOXX 600 added 0.93 percent and the MSCI’s gauge of global index that keeps track of stock exchanges of 47 countries had surged 1.01 percent.

Meanwhile, US 10-year treasury notes on a 3.70 basis points ended the day at 2.086 percent after breaching nearly two-year low at 2.053 percent. Concomitantly, in contrast with a wobbling American dollar, spot gold prices had surged by 0.4 percent to $1339.97 an ounce, after hitting an intra-day high of 1,348.08, its best level since April 2018.