GLOBAL MARKETS-Gold hits record, equities edge higher on stimulus hopes

By David Randall
NEW YORK, July 27 (Reuters) - Global equity benchmarks edged
higher and gold soared to an all-time high on Monday as
investors weighed expectations for another U.S. stimulus package
with concerns that rising tensions between the United States and
China will the slow the recovery of the global economy from the
coronavirus pandemic.
Gold made a 1.6% jump to surpass its 2011 highs and put
$2,000 per ounce XAU= in sight. Silver climbed 7.5% XAG= , to
take its July streak past 30%, which would be its best month on
record. China took over the premises of the U.S. consulate in the
southwestern city of Chengdu on Monday, after ordering that the
facility be vacated in retaliation for China's ouster last week
from its consulate in Houston. U.S. Secretary of State Mike Pompeo said Washington and its
allies must use "more creative and assertive ways" to press the
Chinese Communist Party to change its ways. "U.S. President (Donald) Trump used to say China's President
Xi Jinping is a great leader. But now Pompeo's wording is
becoming so aggressive that markets are starting to worry about
further escalation," said Norihiro Fujito, chief investment
strategist at Mitsubishi UFJ Morgan Stanley Securities.
MSCI's gauge of stocks across the globe .MIWD00000PUS
gained 0.25% following mixed trading in Asia and broad declines
in Europe after the United Kingdom imposed a quarantine on
travelers returning from Spain, which has seen an increase in
coronavirus cases.
In morning trading on Wall Street, the Dow Jones Industrial
Average .DJI fell 3.87 points, or 0.01%, to 26,466.02, the S&P
500 .SPX gained 0.58 points, or 0.02%, to 3,216.21 and the
Nasdaq Composite .IXIC added 53.71 points, or 0.52%, to
10,416.89
Hopes for a quick U.S. economic recovery are fading as
coronavirus infections showed few signs of slowing. That means the economy could suffer without fresh support
from the government, with some earlier steps such as enhanced
jobless benefits due to expire this month.
Investors hope U.S. Congress will agree on a deal before its
summer recess. U.S. Treasury Secretary Steve Mnuchin said the
package will contain extended unemployment benefits with 70%
"wage replacement."
Concerns about the U.S. economic outlook have also started
to weigh on the dollar. The dollar index USD= dropped 0.5% to
its lowest in nearly two years. /FRX
The euro gained 0.5% to a 22-month high of $1.1725 EUR= ,
continuing a winning streak since last week's agreement on a 750
billion-euro post-pandemic EU recovery fund.
Benchmark 10-year notes US10YT=RR last rose 4/32 in price
to yield 0.5774%, from 0.589% late on Friday.
"If you look at the fact that the dollar's been higher
yielding than many other currencies for quite a while, and with
some of the benefits of that being eroded ... and also the
continued demand for a safe haven, it all plays into gold's
strengthening," said Shafali Sachdev, the head of FX Asia at BNP
Paribas Wealth Management in Singapore.
"And at this point there doesn't seem any obvious factor
that could help the trend to draw to a close."
Oil prices were capped on worries about the worsening
Sino-U.S. relations and both new and returning waves of the
coronavirus around the world, which has now infected more than
16 million people and killed nearly 650,000. U.S. crude CLc1 recently fell 0.85% to $40.94 per barrel
and Brent LCOc1 was at $43.08, down 0.6% on the day.


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Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
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MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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