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By David Randall
NEW YORK, March 23 (Reuters) - Global equity benchmarks and
oil prices drifted lower Tuesday while safe haven assets gained
as an extended economic lockdown in Germany and U.S. and
European sanctions on China curbed risk appetite worldwide.
Rising concerns over a third wave of the coronavirus
pandemic amid slow vaccine rollouts in Europe hit oil and travel
companies as investors priced in a longer road to recovery.
Germany extended its lockdown until April 18, while
Chancellor Angela Merkel called on citizens to stay at home for
five days over the Easter holidays.
U.S. crude fell 4.04% to $59.07 per barrel and Brent
was at $61.77, down 4.41% on the day.
Energy stocks were also under pressure, with Chevron Corp
, Occidental Petroleum Corp and Exxon Mobil Corp
shedding 1.5% or more, while travel-related stocks fell
as much as 4%.
"Global travel is still looking like it could be a while
away," said Matt Stanley, a fuel broker at Star Fuels in Dubai,
adding that a second-half recovery in oil demand looked doubtful
as lockdowns remain the order of the day.
MSCI's gauge of stocks across the globe shed
0.40% following broad declines in Europe and Asia.
In morning trading on Wall Street, the Dow Jones Industrial
Average fell 63.65 points, or 0.19%, to 32,667.55, the
S&P 500 lost 4.32 points, or 0.11%, to 3,936.27 and the
Nasdaq Composite added 0.96 points, or 0.01%, to
13,378.50.
Benchmark 10 year Treasury yields gained ahead of
Congressional testimony by Federal Reserve Chair Jerome Powell
and Treasury Secretary Janet Yellen later in the day that may
shed light on the pace of economic rebound from the pandemic.
In remarks prepared for delivery to the hearing on Tuesday
morning, Powell said the U.S. economic recovery had progressed
"more quickly than generally expected".
The Congressional hearings begin at 12 p.m. ET (1600 GMT).
"The FOMC last week laid out pretty clearly what the Fed's
view is with regard to rates ... the next thing that markets
will focus on is maybe getting some details from Yellen with
regard to further infrastructure investment," said Alex Wolf,
head of investment strategy for Asia at J.P. Morgan Private
Bank, referring to a statement from the Federal Open Market
Committee.
The dollar index rose 0.385%, with the euro
down 0.44% to $1.1879.
Adding to market concerns were human rights sanctions on
China imposed by the United States, Europe and Britain that
prompted retaliatory sanctions from Beijing.
Worries over the pace of the recovery from the pandemic were
also heightened after a U.S. health agency said the AstraZeneca
Plc vaccine developed with Oxford University may have
included outdated information in its data.
Spot gold dropped 0.3% to $1,733.11 an ounce.
(Reporting by David Randall. Editing by Jane Merriman)
