* Euro hits four-month peak on reports of progress on EU
talks
* Italian-German spread falls to 162 bps, lowest since late
March
* AstraZeneca shares hit high on COVID experimental drug
* Gold edges up on safe-haven demand
By Herbert Lash
NEW YORK, July 20 (Reuters) - Global equity markets
rebounded on Monday on optimism the European Union would agree
on a recovery fund to help revive regional economies hit by the
coronavirus, but worries about the pandemic's economic and human
toll pushed gold prices higher.
The euro rose after a bout of profit-taking on early gains
that took the single currency to a 19-week high on hopes for an
EU fund expected to be around 750 billion euros ($857.93 bln).
Italy's borrowing costs fell to their lowest since early
March on signs of a potential agreement, which has driven a
rally in southern European bonds, led by Italy, since May.
European shares advanced on hopes for the recovery fund,
while the S&P 500 and Nasdaq rose, led by technology stocks.
News that AstraZeneca's AZN.L experimental COVID-19
vaccine was safe and produced an immune response in early-stage
clinical trials in healthy volunteers helped lift equities, but
it was still too early to call the drug a success.
"We're finally getting the details on these Phase I, Phase
II studies that we kind of all expected to be positive, but it's
all about the Phase III and that's where everything and anything
can go wrong," said Edward Moya, senior market analyst at
currency broker OANDA in New York.
MSCI's benchmark for global equity markets .MIWD00000PUS
rose 0.49%. On Wall Street, the Dow Jones Industrial Average
.DJI fell 0.28%, the S&P 500 .SPX gained 0.27% and the
Nasdaq Composite .IXIC added 1.35%.
In Europe, the broad FTSEurofirst 300 index .FTEU3 closed
up 0.73%. AstraZeneca's AZN.L shares rose 1.8% after hitting a
record high ahead of a report on its vaccine. An attempt to reach a compromise on the recovery fund failed
on Sunday. A deal envisaging 400 billion euros in grants - down
from a proposed 500 billion euros - was rejected by the north,
which said it saw 350 billion euros as the maximum.
Discussions over the grants has since narrowed, with EU
summit Chairman Charles Michel saying they would be based on 390
billion euros combined with smaller rebates.
The euro EUR= was up 0.14%, at $1.1442, while the yen
JPY= gained 0.20%, to $107.2000.
The euro hit its highest against the dollar since March 9,
at $1.1467 EUR=EBS after reports of progress following three
days of negotiations. FRX/
Gold prices jumped to their highest since September 2011 and
silver hit a more-than-four-year peak as a spike in COVID-19
infections and hopes for increased stimulus measures supported
safe-haven demand.
Spot gold prices XAU= rose $6.7542 to $1,815.65 an ounce.
Oil prices fell as coronavirus cases increased in many
countries, though investor optimism about a potential COVID-19
vaccine and ongoing talks over the European Union fund to revive
economies hit by the pandemic curbed losses.
Brent crude futures LCOc1 rose $0.02 to $43.16 a barrel.
U.S. crude futures CLc1 gained $0.08, to $40.67 a barrel.
Earlier in Asia, MSCI's broadest index of Asia-Pacific
shares outside Japan .MIAPJ0000PUS gained 0.26%, reversing
early losses.
Chinese markets rose more than 2% after regulators raised
the equity investment cap for insurers and encouraged mergers
and acquisitions among brokerages and mutual fund houses.
Prices for copper CMCU3 , a barometer of economic growth,
fell after data showed rising inventories in Chinese warehouses
and on concern that climbing coronavirus cases threatened a
sustainable global recovery. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Euro, euro zone bond markets during coronavirus crisis https://tmsnrt.rs/2E1BYm3
Euro jumps to 4-month high https://tmsnrt.rs/3fN2M7r
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