Shares are floating around the world and US Treasury prices are rising


NEW YORK (Reuters) – Stock markets around the world fell on Friday to the longest weekly loss range since 2013, while US Treasury prices have risen along with the demand for safe bets, as US economic data hardly bothers the disappointed companies Profits and trade wars calmed down.

Wall Street crashed after earnings reports from Amazon.com and Alphabet sparked a rush on technology and high-growth stocks. Both stocks had risen sharply on Thursday before their gains.

European and Asian shares led the way. The pan-European STOXX 600 Index lost 1.26 percent and the MSCI value of stocks around the world dropped 1.40 percent.

The global index was more than 14 percent below its record high on January 26 and was earmarked for the fifth consecutive week of losses that had not occurred since May 2013.

Markets had only a temporary reprieve after data showed that US economic growth slowed less than expected in the third quarter as the decline in soybean exports was partially offset by the strongest consumer spending in nearly four years.

While US Treasury yields initially rose from the data, stock market volatility caused them to reverse their course and fall to a three-week low of 3.074 percent on falling stocks.

"Yields have declined today, not because of the GDP report, but because of stock market volatility, which is a global flight to safety," said Collin Martin, fixed income director at New York's Schwab Center for Financial Research.

"Overall, the (GDP) figure has exceeded expectations," he added, "but if you look closely, there were some pros and cons."

Benchmark 10-year notes last rose 16/32 in price to supply 3.0774 percent, up from 3.166 percent on Thursday.

The US dollar slid alongside equities after rising to a two-month high in morning trade after GDP data.

FILE PHOTO – Dealers working on the floor of the New York Stock Exchange (NYSE) in New York, USA, October 22, 2018. REUTERS / Brendan McDermid

The Dow Jones Industrial Average fell 339.24 points or 1.36 percent to 24,645.31, the S & P 500 lost 48.88 points or 1.81 percent to 2,656.69 and the Nasdaq Composite fell 165.65 points or 2.26 percent to 7,152.68.

The US dollar rose against the US data against a basket of major currencies.

The dollar index fell 0.17 percent, the euro rose 0.07 percent to $ 1,1382.

While a strong greenback benefits US assets, it also increases the cost of imports and exports, which impairs growth. The net effect tends to be neutral.

"If you are unwilling and unable to lower your currency at the same time as the tariffs, the currency will offset the tariffs," said Greg Anderson, global head of FX strategy at BMO Capital Markets

The Japanese yen rose 0.75 percent against the greenback at $ 111.57 per dollar, while the pound was last traded at 1.2832, an increase of 0.13 percent a day.

Doubts have been raised as to whether Britain and the European Union can reach a Brexit deal. Bloomberg, citing people familiar with the affair, said on Friday that the Brexit talks were put on hold because Prime Minister Theresa May's cabinet was not close enough to decide what to do next.

MSCI's broadest index of Asia Pacific equities outside of Japan fell 1 percent, offsetting gains made in the first hour and its lowest level since February 2017.

Bear markets – a drop in prices of 20 percent or more of the recent highs – have risen above indices and individual stocks since the beginning of the year.

The oil price was set for a third weekly loss, after Saudi Arabia warned of oversupply and the collapse of stock markets and concerns over trade had dampened the outlook for fuel demand.

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US crude rose 0.01 percent to $ 67.34 a barrel and Brent was up 0.4 percent to $ 77.2 a day.

Spot gold rose 0.7 percent to $ 1,239.95 an ounce.

Additional coverage by Kate Duguid of New York, Ritvik Carvalho; additional coverage by Abhinav Ramnarayan and Tom Finn in London; Cut by Larry King, William Maclean and Susan Thomas

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