Stocks bulls halt their charge

LONDON (Nov 12) - Global shares were on course on Thursday to end their longest winning streak in over a year, one that has lifted them more than 10%, as the post-U.S. election and coronavirus vaccine bull run paused.

Europe's main markets <0#.INDEXE> opened down 0.7% and Wall Street futures fell ESc1. For the first time in November, MSCI's 49-country world index .MIWD00000PUS was in the red. Asia had finished flat.

Big Tech had rebounded on Wednesday as investors switched back to winners like Amazon and Netflix. In Europe, investors returned to safe-haven government bonds.

“What we don’t really agree with is that you need to rotate out of tech into value stocks,” said Willem Sels, chief market strategist at HSBC Private Bank, referring to stocks that do well in normal circumstances when economies are open.

“We don’t think either that a recovery (helped by a vaccine) would lead to a sustained sell-off in U.S. Treasuries. The Fed has signalled it is on hold,” he added.

In the currency market, the euro was near $1.18, in the middle of the $1.16-$1.20 range it’s been in since late July. Sterling was down 0.5% amid more Brexit uncertainty and as data showed the UK economy losing speed again.

Turkey’s lira took a breather after President Tayyip Erdogan’s promise to overhaul unconventional monetary policy and the replacement of his son-in-law as finance minister caused it to rise 10%. [EMRG/FRX]

The New Zealand dollar NZD=D3 soared for a second session to a 19-month high as investors unwound bets on the introduction of negative interest rates.

The kiwi got an added boost after Reserve Bank of New Zealand Assistant Governor Christian Hawkesby said the economy required less stimulus than it did in August.

“The weakness in broad USD (dollar) and reflationary momentum in equities, which we saw on the back of the U.S. election and improvements in the vaccine situation, seem to be fading across FX and equities,” said Christin Tuxen, Head of FX Research at Danske Bank.

Reuters