LONDON: European and Asian stocks recovered further and the Japanese yen slid against the dollar on Wednesday with markets volatility taking centre stage.
After Monday’s collapse that saw trillions of dollars wiped off equity valuations globally, traders have been picking up bargains, with Wall Street ending higher Tuesday.
In foreign exchange, the yen slumped nearly two percent against the dollar Wednesday after the Bank of Japan sought to ease fears that it would keep raising interest rates.
Oil prices jumped about 1.5 percent on Middle East tensions and supply constraints in Libya, having fallen at the start of the week.
“The current (rollercoaster) situation may continue for some time,” noted Asset Management One.
European shares bounce from brutal sell-off
“The increased market volatility shouldn’t be ignored,” it added.
Investors were sent scurrying after data released on Friday showed that the US economy created far fewer jobs than expected in July, fanning recession fears.
That came soon after the Federal Reserve hinted at a September interest-rate cut and following a hike to borrowing costs by the Bank of Japan for only the second time in 17 years – sending shivers through financial markets as the yen jumped in value.
However, BoJ deputy governor Shinichi Uchida on Wednesday indicated that would be it for now given market volatility, sparking a big drop in the yen, while the Tokyo stock market closed up 1.2 percent.
Investors were jittery after Japan’s Nikkei stocks index surged more than 10 percent on Tuesday, a day after tanking more than 12 percent.
One dollar bought 147 yen Wednesday, compared with 142 at the start of the week.
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