LONDON (Reuters) - Investors set aside wide-ranging concerns about the future on Tuesday to send stocks higher after a few sessions of hefty losses and to boost demand for higher-yielding currencies.
As they took a break from worries about credit, a slowing U.S. economy and disappointing earnings, money moved into assets that have been battered in recent days.
MSCI’s main world stock index was up 0.7 percent and its emerging market stablemate gained 2 percent.
But both gains came after recent sharp falls. The main index, for example, lost as much as 3.5 percent over the three previous trading sessions.
“People are buying on dips,” said Terushi Hirotama, head of trading at Ichiyoshi Securities.
Tuesday’s gains were triggered by a rally on Wall Street overnight and positive sentiment engendered by forecast-beating earnings from Apple (AAPL.O) after the New York bell.
Quarterly earnings have been less than robust so far, however.
Generali Investments calculates that with about a quarter of S&P 500 .SPX companies having reported, earnings have contracted by about 3 percent year-on-year. At the beginning of the third quarter, a growth rate of 6.2 percent year-on-year had been expected, it said in a note.
Earnings are seen as having been somewhat better in Europe, however. The FTSEurofirst 300 index of top European shares was up 0.7 percent.
“Today is a classical rebound, but I would expect us to drift lower in weeks to come before rallying in December for end-of-year gains,” said Philippe Gijsels, strategist with Fortis Bank in Brussels.
Earlier, Japan’s Nikkei average ended up 0.07 percent or 12.11 points at 16,450.58. The broader TOPIX index rose 0.5 percent to 1,570.55.
The dollar gave up some of the previous day’s gains, dipping back towards a record low against a trade-weighted basket of currencies after its strongest day in over a year on Monday.
The euro was up 0.2 percent to $1.4204.
The high yielding Australian and New Zealand dollars were both up around 0.5 percent against the greenback.
Demand for euro zone bonds fell, pushing benchmark two-year and 10-year cash yields up around 3 basis points at 4.01 percent and 4.21 percent, respectively.