"World stocks and bonds had a second day of big gains on Wednesday, lifted by healthy U.S. data, moves by China to calm banking sector fears and supportive signals from Europe's central banks.
Markets from safe-haven U.S. Treasuries to riskier stocks and emerging market assets have dropped on worries about the impact of an end to the U.S. Federal Reserve's support program, and as signs emerged of a credit crunch in China.
After both the U.S. and Asia's main share and bond markets had risen overnight, Europe's investors shook off a shaky start to send the FTSEurofirst 300 .The index of top shares up more than 1 percent for a second day running.
Gold and silver, however, both slumped to near three-year lows as investors continued to dump assets used as a safety net in case central bank money printing went wrong or fuelled a spike in inflation.
Markets from safe-haven U.S. Treasuries to riskier stocks and emerging market assets have dropped on worries about the impact of an end to the U.S. Federal Reserve's support program, and as signs emerged of a credit crunch in China".
Bonds had a rebound today ,ease that it is difficult to say is going to last for a long time. Because of the size
of the bond market we could say that lots of volatility and turmoil lies ahead,in the process to adjust portfolios
into a new scenario of higher interest rates,
"As new data showed Europe's economy remains in the doldrums, the region's policymakers were again out in force to try and calm any market jitters.
Both the European Central Bank and Bank of England said on Tuesday that, unlike the Fed, they remained in full support mode.
Bank for International Settlements General Manager Jaime Caruana also told Reuters in an interview the BIS was not demanding immediate action on global exiting and that the timing of an exit had to be determined by each central bank individually.
The annual report from the BIS - known as "the central banks' central bank" - provoked a storm of response at the weekend after saying an exit from accommodative policies would only become harder over time.(See previous post in this Blog)
Draghi's comments helped pushed the euro to a three-week low of $1.3035 against a broadly stronger dollar .DXY and helped trim yields on the peripheral-economy euro zone bonds which have jumped by more than half a percent over recent weeks.
Spanish 10-year yields dropped 16 basis points to 4.88 percent while equivalent Italian yields were 14 bps lower at 4.74 percent".
