In This Article:
* Europe waits for ECB liftoff signal on first rate rise
* Yen hits 20-year low against dollar
* China shares stumble as Shanghai sees new COVID-19 curbs
* Oil holds about $123 a barrel
* Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates http://tmsnrt.rs/2egbfVh
*
By Marc Jones
LONDON, June 9 (Reuters) - Investors buckled up on Thursday for the European Central Bank’s signal that it is ready to raise its interest rates for the first time in a decade, while the yen weakened to a new 20-year low on bets the Bank of Japan will lag way behind.
There was little else worth focusing on. How fast the ECB will now lift the euro zone's subzero borrowing costs has dominated markets for months, coming as part of the most widespread tightening of global monetary policy in decades.
Bond dealers marked the moment by pushing Germany's 10-year government bond yield - the main proxy for European borrowing rates - to its highest level in nearly eight years. Stocks slipped nearly 1%. The euro barely budged.
With euro zone inflation at a record-high 8.1% and broadening quickly, the ECB has already flagged a series of moves, including also ending its long-running asset buying programme at the end of this month. Details will be crucial though.
"The bar has been set pretty high by the drum beat of recent comments (from top ECB policymakers)," said Saxo Bank's head of head of FX strategy John Hardy, referring to signals that rates will start rising next month, possibly even by a meaty half percent.
"So it is about A) do they clear that bar, and B) how does market react.... I don't think they (ECB) will want to take anything off the table."
Losses in European stocks were broad-based and led by miners , while the energy sector was the sole gainer, up 0.4% as oil prices remained above an eyewatering $123 a barrel even as China imposed new COVID lockdown measures in Shanghai.
Asian stocks had fallen overnight and Wall Street futures were flat, although it was more to do with the renewed rise in both global bond yields and the dollar that will ultimately mean tighter financial conditions.
MSCI's broadest index of Asia-Pacific shares outside Japan was closing down 0.65%, with Australian shares down 1.2% and Seoul's KOSPI 0.5% lower. Hong Kong's Hang Seng turned around from small gains to fall 0.75% and Chinese A-shares fell 1%
"It's classic pre-central-bank-meeting price action," said Matt Simpson, senior market analyst at City Index in Sydney, again referring to the 1145 GMT and 1230 GMT and ECB announcement and news conference.