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Euro STOXX 600 up 0.4%
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Oil prices rebound on China hopes, talk of output cuts
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Dollar falls as investors seek riskier assets
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China property shares rally on policy support
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Global asset performance http://tmsnrt.rs/2yaDPgn
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World FX rates http://tmsnrt.rs/2egbfVh
By Tom Wilson and Wayne Cole
LONDON/SYDNEY, Nov 29 (Reuters) - Stocks and oil gained
on Tuesday on hopes that public unrest in China might prompt an
earlier loosening of COVID-19 curbs in the world's second
biggest economy, with the yuan up and the dollar down as
investor appetite for riskier assets grew.
The Euro STOXX 600 gained 0.4%, recovering from its
worst session in almost two weeks a day earlier. Shares in
London were up 0.8% and markets in Paris and
Frankfurt gained around 0.2%-0.3%.
Hopes of faster easing of China's strict restrictions rose
after an official said they will continue to fine-tune policy to
reduce the impact of its "Zero COVID" on society.
Simmering discontent with Beijing's stringent COVID
prevention policies three years into the pandemic ignited over
the weekend into broader protests in Chinese cities thousands of
miles apart.
"China is the dominant story in markets at the moment, and
the pattern of risk assets that we have seen overnight is what
we would expect with better news" said Hugh Gimber, global
market strategist at JP Morgan Asset Management.
"Positive news for the Chinese economy is positive news for
the global economy."
The MSCI world equity index, which tracks
shares in 47 countries, rose 0.3%, while S&P 500 futures
rose 0.5% and Nasdaq futures 0.7%.
The sudden bout of optimism on China combined with talk of
possible output cuts by OPEC+ to help oil prices rally.
U.S. crude futures bounced $1.53 to $78.78 a barrel,
having hit their lowest this year overnight, while Brent
climbed $1.83 to $85.12.
European government bonds rose as investors moved towards
riskier assets, with the yield on the benchmark German 10-year
Bund falling almost 9 basis points.
The dollar also fell 0.5% against a basket of currencies to
106.06, and shed 0.9% against the offshore yuan to 7.1830
, erasing all the gains made on Monday.
Earlier, MSCI's broadest index of Asia-Pacific shares
outside Japan gained 1.8%.
Shares of Chinese property companies surged after the
country's securities regulator lifted a ban on equity
refinancing for listed property firms.
That helped Chinese blue chips jump almost 3%, in
the largest one-day rally in a month and a marked reversal of
Monday's steep falls.
HIGHER FOR LONGER
Richmond Federal Reserve Bank President Thomas Barkin became
the latest official to douse speculation the U.S. central bank
would reverse course on interest rates relatively quickly next
year.
That heightened tensions ahead of speech by Fed Chair Jerome
Powell on Wednesday that is shaping up to be a major messaging
event as markets yearn for a pivot on policy.
Analysts suspect they may be disappointed.
"We envision him basically confirming a slower pace of hikes
at the December meeting, which is almost entirely priced in,"
said Jan Nevruzi, an analyst at NatWest Markets. "But we also
think he will reiterate that the Fed intends to stay in
restrictive territory through next year."
The Fed is not alone in being hawkish, with European Central
Bank President Christine Lagarde warning that euro zone
inflation has not peaked and could go even higher.
The euro was 0.4% higher at $1.0385, having hit a
five-month peak of $1.0497 overnight.
Spain's consumer prices in the year to November rose 6.8%, a
slower pace than the 7.3% over the 12 months to October,
preliminary data showed on Tuesday.
Spain's two-year bond yields fell 9.5 basis
points to 2.310% on the data.
Figures for inflation in Germany are due later on Tuesday,
ahead of the main euro zone report on Wednesday.
(Reporting by Tom Wilson in London and Wayne Cole in Sydney;
Editing by Bradley Perrett, Kirsten Donovan)
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