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GLOBAL MARKETS-Shares slide as Nasdaq tumbles, dollar edges higher

Stock Markets May 05, 2021 07:20
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© Reuters.

(Adds U.S. market close)
* Dollar clawing back ground in FX markets
* Commodities consolidate gains
* Graphic: Global asset performance
* Graphic: World FX rates

By Herbert Lash and Marc Jones
NEW YORK/LONDON, May 4 (Reuters) - World equity indexes slid
and U.S. Treasury yields fell on Tuesday as low trading volume,
a lull in economic news and lack of a catalyst to lift stocks
higher sparked a sell-off by investors worried further upside in
markets is limited.
The tech-rich Nasdaq .IXIC fell 1.9%, its biggest
single-day decline in almost six weeks, while the yield on
10-year Treasury notes US10YT=RR fell to a low of 1.557%, a
slide that normally would push technology shares higher on lower
financing costs.
A surge in commodity prices bucked the downdraft in equity
markets, helping spur talk of rising inflation, while the dollar
rose after U.S. Treasury Secretary Janet Yellen said interest
rates may need to rise to prevent overheating the U.S. economy.
Yellen later downplayed inflation and rate hike
concerns. The Refinitiv/CoreCommodity CRB Index .TRCCRB traded near
three-year highs as commodities rallied on investor bets that
demand will grow as economies reopen.
Investors sold the high-flying tech-related stocks that have
doubled the value of the Nasdaq since March 2020 lows, and
bought government debt, pushing yields lower.
Apple Inc AAPL.O , Inc AMZN.O and Microsoft
Corp MFST.O led the decline on Nasdaq and the S&P 500.
"There's not a lot of conviction among traders of which way
markets should go from here," said Patrick Leary, chief market
strategist and senior trader at Incapital. "We've priced in a
great amount of reopening optimism."
MSCI's benchmark for global equity markets .MIWD00000PUS
fell 0.81% to close at 697.60.
On Wall Street, the Dow Jones Industrial Average .DJI rose
0.06%, the S&P 500 .SPX lost 0.67% and the Nasdaq Composite
.IXIC dropped 1.88%.
Economically sensitive value stocks .RLV eked out a gain
of 0.04%, outperforming a 1.6% slide in growth stocks .RLG .
After Tuesday's slide, the Russell 1000 Value Total Return Index
.RLVTRI has nearly tripled the performance of the Russell 1000
Growth Total Return Index so far this year.
European tech stocks .SX8P plunged 3.8% in their worst day
since late October. Germany's bourse .GDAXI shed 2.5%, the
most in Europe, due to its high composition of tech stocks.
Chipmaker Infineon IFXGn.DE fell 5.9%, among the top drags
on the German index, after the company said automotive supply
constraints would only ease in the second half, with lost
volumes likely to be made up in 2022. Skepticism crept into the Treasury market that upcoming
economic data might not be as stellar as the market has priced
in, keeping a damper on longer-dated bonds. The benchmark
10-year Treasury note US10YT=RR last yielded 1.587%.
In currency markets, the dollar clawed back some ground to
partially unwind last month's long decline as investors squared
up positions ahead of monthly payrolls data due at the end of
the week. FRX/
The dollar index =USD rose 0.289%, with the euro EUR=
down 0.36% at $1.2018. The Japanese yen JPY= weakened 0.19%
versus the greenback at 109.28 per dollar.
Signs that the world's major central banks remain in no rush
to reel in their massive stimulus programs kept 10-year U.S.
Treasury yields under 1.65% and Germany's Bund yields below
13-month highs. GVD/EUR
Australia's central bank left its key interest rates at near
zero overnight for a fifth straight meeting and pledged to keep
its policies super-supportive for a prolonged
period. Australia's S&P/ASX200 .AXJO had risen 0.6% and Hong Kong
.HSI had climbed 0.7% in thin Asian trading due to holidays in
both China and Japan.

Cryptocurrency ether ETH=BTSP powered to another record
peak, nearing $3,500, before paring gains to close 0.8% lower.
Oil prices rose after more U.S. states eased
pandemic-related lockdowns and the European Union sought to
attract travelers, though soaring COVID-19 cases in India capped
Brent crude futures LCOc1 settled up $1.32 at $68.88 a
barrel, while U.S. crude futures CLc1 rose $1.20 to settle at
$65.69 a barrel.
Gold fell 1% on Yellen's remarks as rising rates increase
the opportunity cost of holding the non-interest bearing
precious metal.
U.S. gold futures GCv1 settled down 0.9% at $1,776 an

Emerging markets
Global asset performance
Sterling's referendum rollercoaster rides
India suffering world's worst COVID wave

GLOBAL MARKETS-Shares slide as Nasdaq tumbles, dollar edges higher

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