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European Stocks at Record on Tech and ECB Bets: Markets Wrap

(Bloomberg) — European stocks hit a new record high, boosted by a continued rally in tech stocks and an expected interest rate cut from the European Central Bank on Thursday.

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While the pan-European benchmark Stoxx 600 index gained 0.7%, the technology subindex rose 2.6%, following strong gains from Wall Street tech giants. U.S. stock futures also rose slightly, pointing to a new all-time high for the S&P 500. In U.S. pre-market trading, Nvidia Corp. rose nearly 2%, after surpassing $3 trillion in market capitalization on Wednesday, becoming the first computer chip company to achieve that goal. milestone.

Other U.S. technology companies, including Micron Technology Inc. and Advanced Micro Devices Inc., also advanced in premarket trading, while in Europe, ASML Holding NV and ASM International NV hit new record highs.

“Behind the optimism we see in the markets, technology continues to lead the pack,” said Matt Stucky, senior portfolio manager at Northwestern Mutual Wealth Management. “Earnings revisions favor technology and it shows in terms of stock market leadership.”

The tech optimism coincides with growing investor confidence in the ability of developed country central banks to ease monetary policy this year. The ECB is expected to make a 25 basis point cut on Thursday, after the Bank of Canada launched its tapering cycle and hinted that more easing was to come. Traders have also started to anticipate further easing from the Federal Reserve this year.

“With the Bank of Canada cutting rates and the expectation that the ECB will do so, the momentum behind a coordinated global easing cycle is starting to gain momentum,” Stucky said.

Bond yields across Europe rose slightly ahead of the meeting, as traders awaited more guidance on the path forward for further easing from ECB President Christine Lagarde. Bets on further ECB cuts have become more cautious following data showing stronger-than-expected economic growth, inflation and wage increases.

Treasury yields also rose slightly after falling in the previous session, with markets almost fully pricing in two Fed rate cuts in 2024. While a private employment figure released on Wednesday showed that hiring in businesses grew at the slowest pace since the start of 2024, the services sector grew the most in nine months. Key monthly employment data released Friday are expected to show an acceleration in job creation in May after April’s surprisingly weak figure.

Earlier in Asia, stocks rose for the first time in three days as Indian stocks extended gains after Prime Minister Narendra Modi secured crucial support from two key allies in his coalition. Taiwan Semiconductor Manufacturing Co. rose 7.4% to a new record high. The chip giant announced a share buyback.

In the materials sector, oil rose for a second session, while copper led the rise in industrial metals prices, while zinc and nickel also advanced.

Key events this week:

  • Eurozone retail sales, ECB rate decision, Thursday

  • First unemployment claims in the United States, trade, Thursday

  • Chinese trade and foreign exchange reserves, Friday

  • Eurozone GDP, Friday

  • U.S. unemployment rate and nonfarm payrolls, Friday

Some of the main market movements:

Actions

  • The Stoxx Europe 600 rose 0.6% at 10:04 a.m. London time

  • S&P 500 futures little changed

  • Nasdaq 100 futures rose 0.1%

  • Dow Jones Industrial Average futures little changed

  • The MSCI Asia-Pacific index rose 0.8%

  • The MSCI Emerging Markets Index rose 0.9%

Currencies

  • Bloomberg Dollar Spot Index little changed

  • The euro was little changed at $1.0878

  • The Japanese yen was little changed at 156.18 per dollar.

  • The offshore yuan was little changed at 7.2614 per dollar.

  • Sterling was little changed at $1.2789.

Cryptocurrencies

  • Bitcoin fell 0.4% to $70,952.88

  • Ether fell 0.4% to $3,848.74

Obligations

  • The yield on 10-year Treasury notes rose three basis points to 4.30%

  • The German 10-year yield rose two basis points to 2.53%

  • The UK 10-year yield was little changed at 4.18%

Raw materials

  • Brent crude rose 0.5% to $78.78 a barrel

  • Spot gold rose 0.4% to $2,363.77 an ounce

This story was produced with the help of Bloomberg Automation.

–With help from Matthew Burgess and Toby Alder.

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News Source : finance.yahoo.com
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Sara Adm

Aimant les mots, Sara Smith a commencé à écrire dès son plus jeune âge. En tant qu'éditeur en chef de son journal scolaire, il met en valeur ses compétences en racontant des récits impactants. Smith a ensuite étudié le journalisme à l'université Columbia, où il est diplômé en tête de sa classe. Après avoir étudié au New York Times, Sara décroche un poste de journaliste de nouvelles. Depuis dix ans, il a couvert des événements majeurs tels que les élections présidentielles et les catastrophes naturelles. Il a été acclamé pour sa capacité à créer des récits captivants qui capturent l'expérience humaine.
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