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Published: 10:37, June 28, 2022 | Updated: 17:24, June 28, 2022
Stocks, oil edge up as China relaxes quarantine rules
By Reuters
Published:10:37, June 28, 2022 Updated:17:24, June 28, 2022 By Reuters

LONDON - Global shares moved into positive territory on Tuesday while oil prices firmed following China's decision to ease some quarantine requirements for international arrivals that raised hopes for growth and a revival in demand for commodities.

Asian shares rose after the announcement and European stocks opened firmly in the green which sent the MSCI's benchmark for global stocks into positive territory and on track for its fourth consecutive daily gain.

MSCI's broadest index of Asia-Pacific shares rose 0.3 percent, while China's CSI 300 Index gained over 1 percent. China's tourism stocks gained over 5.5 percent.

The pan-European STOXX 600 was up 0.6 percent, boosted by oil & gas and mining stocks but the outlook for developed market stocks remains challenging as central banks attempt to balance stubbornly high inflation with slowing growth.

"Equity markets will not be out of the woods until central banks shift their rhetoric to a less hawkish stance," said Salman Baig, portfolio manager, cross asset solutions, at Unigestion

"Unfortunately for many investors, such a pivot will likely not happen until after the economy has slowed down sufficiently to bring inflation on a sustainably downward path."

The European Central Bank's Forum on Central Banking in Sintra continued on Tuesday with a focus on a speech from ECB President Christine Lagarde.

Lagarde said the ECB will move gradually when it begins raising rates but with the option to act decisively on any deterioration in medium-term inflation, especially if there are signs of a de-anchoring of inflation expectations. 

Euro zone government bond yields held near their highs after Lagarde's comments, with Germany's 10-year yield, the benchmark for the bloc, up 8 basis points at 1.63 percent.

The euro was little changed against the dollar following Lagarde's initial comments.

The dollar index , which measures the greenback against a basket of six currencies, was little changed at 103.97.

Oil prices swung higher with focus already on tight supply as G7 leaders agreed to study placing price caps on imports of Russian oil and gas.

US crude rose 1.41 percent to $111.08 a barrel. Brent crude jumped 1.3 percent to $116.59 per barrel.

"A seam of tight supply news bolstered the (oil) market," said analysts at Commonwealth Bank of Australia. "Political unrest might curtail supply from a couple of second-tier producers, Ecuador and Libya. And then there's the G7's proposed price cap on Russian oil."

Gold was 0.2 percent higher with the spot price trading at $1,827 per ounce.

Bitcoin rose 0.8 percent, trading at $20,870 after falling as low as $17,588.88 earlier this month.

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