SYDNEY (Reuters) – Asian shares braced for more volatility on Thursday as eye-catching easings by central banks stoked fears of global recession, driving U.S. yields to near-record lows and lifting gold past $1,500 for the first time since 2013.
Spot gold was last at $1,503.56 per ounce, having been as far as $1,510. The precious metal has surged 16% since May as the worsening Sino-U.S. trade dispute sparked a rush to safe havens.
Markets - Risks - Recession - JPMorgan - Economist
“Financial markets are raising risks of recession,” said JPMorgan economist Joseph Lupton.
“Equities continue to slide and volatility has spiked, but the alarm bell is loudest in rates markets, where the yield curve inverted the most since just before the start of the financial crisis.”
Thursday - Share - Markets - Investors - Footing
Early Thursday, Asian share markets were wobbly, as investors tried to find their footing after enduring a string of heavy losses. MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.03%, having shed 8% in less than two weeks.
Japan’s Nikkei inched up 0.1%, and away from seven-month lows. E-Mini futures for the S&P 500 lost 0.13%.
Relief - Wall - Street - Come - Dow
There was much relief that Wall Street had managed a late come back overnight, so that the Dow ended with a loss of just 0.09% having been down 500 points at one stage. The S&P 500 tacked on 0.08% and the Nasdaq 0.38%.
Stocks had initially been pressured by the flight to bonds. Yields on U.S. 30-year bonds dived as deep as 2.123%, not far from an all-time low of 2.089% set in 2016.
Yields - Rates - Inversion - Recessions - Past
Ten-year yields dropped further below three-month rates, an inversion that has reliably predicted recessions in the past.
The latest spasm began when central banks in New Zealand, India and Thailand surprised markets with aggressive easings, while the Philippines is expected to cut later Thursday.
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