GLOBAL MARKETS-Equities sink on virus angst, Fed aftermath; gold, yen rise

(Adds gold, oil settlement prices)
* Wall Street slips as tech sell-off resumes
* Yen, yuan shine as pressure returns to USD
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn

By Herbert Lash
NEW YORK, Sept 18 (Reuters) - Global equity markets slid on
Friday as investors sought direction after this week's U.S.
Federal Reserve meeting and a jump in coronavirus cases in
Europe rattled sentiment, while gold rose and safe-haven buying
lifted the Japanese yen.
The dollar was on track for its fifth straight day of
declines against the yen as Japan's monetary policy of yield
curve control pushes up real interest rates.
U.S. technology-related stocks reversed early gains on Wall
Street to extend their decline to a third day. Apple Inc
AAPL.O , Microsoft Corp MSFT.O , Amazon.com Inc AMZN.O and
Alphabet Inc GOOGL.O , which have fueled the U.S. stock rally
from a pandemic-induced slump in March, led equities lower.
A decision by President Donald Trump's administration to ban
WeChat and video-sharing app TikTok from U.S. app stores
starting Sunday night raised concerns about a new front in
continuing China-U.S. political tensions. "The diplomatic tug of war is not being resolved," said
Boris Schlossberg, managing director of FX strategy at BK Asset
Management. "The tensions are heightening rather than easing.
That's not something the market likes to see."
The Japanese yen JPY= strengthened 0.22% versus the
greenback at 104.49 per dollar, after earlier gaining to 104.270
- its strongest level against the U.S. currency since July 31.
The dollar index =USD rose 0.01%, with the euro EUR= up
0.04% at $1.1852.
Worries about rising coronavirus cases and a patchy economic
recovery weighed on sentiment. An expected rotation into value
stocks from growth and momentum has yet to fully materialize,
said Yousef Abbasi, global market strategist at StoneX.
"There really isn't a value sector that's positioned to take
the reins and lead," Abbasi said. "There's a lack of a catalyst
to force people to look more seriously at value as leadership."
MSCI's benchmark for global equity markets .MIWD00000PUS
fell 0.76% to 565.85, while in Europe, the broad FTSEurofirst
300 index .FTEU3 closed down 0.62% at 1,429.67.
A resurgence in coronavirus cases is the biggest threat to
the recovering euro zone economy, according to a Reuters poll of
economists, who say growth and inflation are more likely to
cause negative surprises over the coming year than positive
ones. Roughly 30 million people have been infected by the virus
worldwide and more than 900,000 have died, triggering some of
the deepest recessions on record and disrupting global supply
chains.
"The COVID-19 infection rate in Europe has gotten pretty
bad," said Tom Martin, senior portfolio manager at Globalt
Investments in Atlanta. "The implications are that it's
difficult to curtail the virus."
Investors ignored a report that showed U.S. consumer
sentiment increased in early September, with Democrats more
upbeat about the economy's outlook compared with Republicans
ahead of the Nov. 3 presidential election. On Wall Street, the Dow Jones Industrial Average .DJI fell
1.09%, the S&P 500 .SPX lost 1.38% and the Nasdaq Composite
.IXIC dropped 1.54%.
No major economic data was expected until the release of
September's unemployment report on Oct. 2, leaving investors
without a compass.
U.S. Treasury yields were little changed near the middle of
recent trading ranges as government-bond investors once again
took their cue from equity markets.
The benchmark 10-year U.S. Treasury US10YT=RR note traded
at 0.6937%.
Euro zone government bond yields also traded little changed
as expectations of more central bank policy easing coupled with
concerns about the economic recovery underpinned sentiment.
Safe-haven German 10-year bond yields DE10YT=RR were up
0.3 basis point at -0.488%.
Investors piled into emerging markets assets, with an index
of developing countries' currencies poised for its biggest
weekly gain since early June as developing country debt funds
enjoyed their 11th straight week of inflows. Copper touched its highest in more than two years as
speculators extended their buying spree on the economic recovery
in top metals consumer China while the dollar weakened.
China has been a major beneficiary of investment flows as
the country is the most attractive market for asset managers
with cash to allocate, according to fund flow tracker EPFR.
Stocks overnight in China made their strongest gains in
three weeks, with the CSI300 index .CSI300 adding 2.2%, led by
financial companies.
Gold prices gained, buoyed by a weaker dollar and concerns
over the economic recovery that were underscored on Thursday by
the elevated weekly U.S. jobless claims data.
Spot gold prices XAU= rose 0.47% to $1,951.81 an ounce.
U.S. gold futures GCv1 settled up 0.6% at $1,962.10.
Oil prices settled little changed after a Libyan commander
said a blockade of Libya's oil exports would be lifted for a
month, while the decline in U.S. equities weighed on futures.
Still, both the U.S. and Brent crude benchmarks were set for
weekly gains after Saudi Arabia pressed allies to stick to
output quotas, Hurricane Sally cut U.S. production, and banks
including Goldman Sachs predicted a supply deficit.
Brent crude futures LCOc1 slid 15 cents to settle at
$43.15 a barrel. U.S. crude futures CLc1 rose 14 cents to
settle at $41.11 a barrel.

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Fed "dot plots" https://tmsnrt.rs/2FEvjyV
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