World stocks stall ahead of EU meeting on Covid-19 stimulus

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Asian shares, however, were slightly higher on Wall Street, as the dollar slipped against the currencies of oil-producing states

London — Caution gripped markets on Thursday, with stocks falling before a key euro group meeting to discuss joint stimulus measures, offsetting optimism from a fresh round of US coronavirus aid and a recovery in oil prices.

“The EU Council meeting will be closely watched to see how quickly EU policymakers will move towards area-wide fiscal risk-sharing,” said George Cole, an economist at Goldman Sachs. “We expect the discussions to fall short of a full commitment to mutualise risks from the Covid-19 shock.” Stocks and other risky assets barely acknowledged those numbers, though, since they were mostly backward-looking data. It was the EU meeting and the outcome that weighed on markets.

The silver lining in macro-economic news overnight was the European Central Bank’s decision to let banks post collateral that was downgraded to junk during the Covid-19 pandemic to prevent a credit squeeze in the eurozone. That pushed down the cost of insuring exposure to a basket of sub-investment grade European companies.

 

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World stocks rise as focus turns to EU Covid-19 meetingEuropean stocks firm and the dollar continues to reign, but off two-week highs, as turbulent oil prices continue to batter the markets
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