Global Markets – Wall Street points to higher opening as pound rises after record drop By Reuters

Written by Caroline Cohen

LONDON (Reuters) – U.S. stock index futures pointed to a higher open on Wall Street on Tuesday as the pound rebounded from this week’s record lows against the dollar as investors traded stocks after recent sharp market moves.

* S&P futures are up 1.25% after Wall Street’s plunge in the previous session. US 10-year Treasury yields have fallen from a 12-year high on Monday. The dollar fell from its highest level in 20 years against a basket of six major currencies.

* Markets are concerned about the pace of US interest rate hikes to tame inflation, a concern that has hurt risky assets and boosted the dollar.

* “Interest rate expectations in the US have risen significantly,” said Andrew Hardy of Momentum Global Investment Management, although he added that “markets have already posted a lot of pullback.”

– Sterling fell to a record low of $1.0327 on Monday on concerns about funding for the UK’s announced tax cuts, along with massive energy subsidies.

* However, it rose 4.6% to $1.0806 on Tuesday after the Bank of England said late Monday that it would not hesitate to change interest rates and was following the markets “closely”.

The yield on British five-year Treasuries rose as much as 100 basis points in two trading days, but fell 29 basis points on Tuesday.

* For its part, the yield on the 10-year Treasury fell by 7 basis points after reaching 3.933% the day before.

– The MSCI global stock index rose 0.15% after hitting its lowest level since November 2020 on Monday, and European shares rose 0.8% and the index stabilized.

* MSCI’s broadest index of Asian shares excluding Japan hit a new two-year low before improving by 0.35%. The Japanese rose 0.5%.

– The euro fell 0.27% to 113.56, after reaching 114.58 on Monday, the highest level since May 2002. The euro rose 0.36% to $0.9641 after trading at its lowest level in 20 years last night.

– Oil prices rose more than 1.5% by 1249 GMT, after falling to their lowest levels in nine months in the previous session, helped by supply restrictions in the Gulf of Mexico before Hurricane Ian and a slight decline in the dollar.

– which hit a two-and-a-half year low in the previous session, rose 1.2% to $1,640 an ounce.

(Reporting by Zhe Yu in Hong Kong; Spanish editor by Carlos Serrano)