Talk of possible virus treatment sparks risk asset rally Death...

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    • Talk of possible virus treatment sparks risk asset rally
    • Death toll from coronavirus rises to 490
    • U.S. private payrolls rise more than expected in January
    • U.S. services sector activity picks up in January
    • Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

    (Recasts, adds new comment, U.S. data, FX table, updates prices, changes byline, dateline; previous LONDON)

    The dollar gained against the safe-haven yen and Swiss franc on Wednesday, as risk appetite rose on reports of a possible treatment for the new coronavirus out of China that has gripped the world and caused major disruptions among global businesses.

    The U.S. currency also benefited from a private-sector payrolls report for January that surpassed market expectations, suggesting the world's largest economy was on a stable growth path and interest rate cuts were off the table for now.

    The focus, though, remained on the coronavirus, which has claimed 490 lives, most in and around the locked-down central city of Wuhan, where the new virus emerged late last year.

    There have been two deaths outside mainland Chin in the Philippines and Hong Kong, both following visits to Wuhan.

    But the yen and Swiss franc fell after media reported a Chinese university had found a drug to treat people with the virus, while researchers in Britain had made a "significant breakthrough" in finding a vaccine.

    While the Chinese report was a day old and the British report indicated the research trials were in early stages, traders used the headlines to load up on risky assets.

    "The market is starting to brush off the coronavirus," said Erik Nelson, currency strategist, at Wells Fargo Securities in New York. "What's driving this are some of the headlines on possible vaccines. So there is some optimism about having potentially a way to treat the symptoms from having the coronavirus."

    Risk sentiment also improved after U.S. private-sector payrolls increased by 291,000 in January, according to the ADP National Employment Report, far above expectations of an increase of 156,000 jobs. January's job gains were the largest since May 2015.

    In addition, U.S. services sector activity picked up last month, with industries reporting increases in new orders. The Institute for Supply Management's non-manufacturing activity index rose to 55.5 last month, the highest level since August.

    "The U.S. has shown quite a bit of resilience for a long time and to the extent that the global economy is going to turn the corner, that's good for the U.S.," said Wells Fargo's Nelson.

    In late morning trading, the dollar rose 0.2% against the yen to 109.71 yen JPY= , after earlier rising to a two-week high of 109.84 yen.

    It also rose 0.4% versus the Swiss franc to 0.9727 franc CHF= . The euro, meanwhile, fell 0.4% to $1.1003 EUR= , pushing the dollar index up 0.3% at 98.264 .DXY . The Australian dollar, a barometer of risk appetite towards China given its close economic ties with Beijing, was also well-bid, up 0.2% versus the dollar at US$0.6754 AUD= .

    The Chinese currency in the offshore market also rebounded 0.3% against the dollar CNH=D3 , which fell to 6.973 yuan.

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    	Currency bid prices at 10:42AM (1542 GMT) 
    
     Description	  RIC		 Last		   U.S. Close  Pct Change	 YTD Pct	 High Bid	Low Bid 
    											  Previous				   Change				  
    											  Session											
     Euro/Dollar	  EUR=		$1.1001		$1.1042	 -0.37%		 -1.86%	  +1.1047	 +1.0998 
     Dollar/Yen	   JPY=		109.7000	   109.5100	+0.17%		 +0.77%	  +109.8400   +109.3100 
     Euro/Yen		 EURJPY=	 120.70		 120.96	  -0.21%		 -1.03%	  +121.1400   +120.6600 
     Dollar/Swiss	 CHF=		0.9726		 0.9690	  +0.37%		 +0.50%	  +0.9747	 +0.9679 
     Sterling/Dollar  GBP=		1.2985		 1.3029	  -0.34%		 -2.07%	  +1.3069	 +1.2958 
     Dollar/Canadian  CAD=		1.3292		 1.3272	  +0.15%		 +2.36%	  +1.3302	 +1.3262 
     Australian/Doll  AUD=		0.6746		 0.6737	  +0.13%		 -3.92%	  +0.6774	 +0.6725 
     ar																							  
    
     Euro/Swiss	   EURCHF=	 1.0700		 1.0702	  -0.02%		 -1.40%	  +1.0728	 +1.0691 
     Euro/Sterling	EURGBP=	 0.8469		 0.8474	  -0.06%		 +0.18%	  +0.8490	 +0.8435 
     NZ			   NZD=		0.6476		 0.6488	  -0.18%		 -3.86%	  +0.6502	 +0.6475 
     Dollar/Dollar																				   
    
     Dollar/Norway	NOK=		9.2152		 9.2095	  +0.06%		 +4.97%	  +9.2493	 +9.1769 
     Euro/Norway	  EURNOK=	 10.1382		10.1701	 -0.31%		 +3.05%	  +10.2147	+10.1120 
     Dollar/Sweden	SEK=		9.5759		 9.5883	  -0.51%		 +2.44%	  +9.6011	 +9.5516 
     Euro/Sweden	  EURSEK=	 10.5365		10.5902	 -0.51%		 +0.64%	  +10.5985	+10.5280 
    	<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ 
    Australian dollar	https://tmsnrt.rs/2trCVPs 
    
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