NEW YORK, March 19 — Global equity markets gained yesterday after traders cheered a Russian bond payment that averted a historic sovereign default, while gold prices dropped as demand for the safe-haven metal eased following the start of the US interest rate hike cycle.
“If you think about where we could have been if Western governments had disallowed the use of frozen funds for coupon payments on Russian sovereign bonds, we would be sitting on a default of a world economy,” said Jamie Cox, managing partner at Harris Financial Group in Virginia. European stocks closed higher as peace talks to end the Russia-Ukraine conflict continued amid heavy fighting.Wall Street’s three major indexes closed higher, boosted by recently battered technology stocks, after talks between US President Joe Biden and Chinese President Xi Jinping over the Ukraine crisis ended without big surprises.
The US dollar index bounced back from recent declines as Federal Reserve officials said the central bank may need to be more aggressive to deal with inflation, while the dollar hit a fresh six-year high against the yen.Gold prices were on track for their biggest weekly drop in nearly four months, in the wake of the Fed interest rate hike and a rebound in the U.S dollar.
The benchmark 10-year yield was down to 2.1548 per cent from 2.167 per cent and the 30-year yield was at 2.4225 per cent from 2.461 per cent on Thursday, in a sign of risk aversion.