Global stocks near record highs on Friday after strong economic data from the United States and China bolstered expectations of a solid global recovery from the coronavirus-induced fall.
European equities are expected to increase in inches, with Euro Stoxx futures up 0.1% and British FTSE futures slightly higher.
MSCI’s broader Asia-Pacific equities index outside of Japan (.MIAPJ0000PUS) rose 0.25% for the last time, and Shanghai equities (.SSEC) added 0.6%. The Japanese Nikkei (.N225) rose 0.1%.
MSCI’s broadest global stock indicator (.MIWD00000PUS) rose 0.05% for late Asian trade, staying just below Thursday’s record high.
“Markets expect advanced economic normalization as vaccines will shift. Stock prices are likely to rise gradually as future gains are seen,” said Tomo Kinoshita, global market strategist at Invesco Asset Management in Tokyo. .
Asian markets remained largely stable after China recorded record growth of 18.3% in the first quarter, although the reading slightly lowered expectations, while retail sales rebounded strongly. last month. Read more
The data did little to change the outlook that its rapid expansion is expected to moderate by the end of this year, as the government focuses its attention on curbing financial risks in overheating parts of the economy.
“Regulators could make more efforts to cool the real estate market and control internal leverage. Fiscal discipline could also be strengthened, leading to a slowdown in local government funding and infrastructure investment,” said Chaoping Zhu, strategist of Morgan Morgan Asset Management global market in Shanghai. .
U.S. data overnight was also optimistic, with retail sales rising 9.8% in March, raising the level of sales 17.1% above its pre-pandemic level. to an all-time high. Read more
The brighter economic outlook was underlined by other data, including claims for the first time for unemployment benefits that fell last week to the lowest level since March 2020.
“The U.S. recovery looks very strong. And now that restaurants and hotels, both of which require a lot of labor, are reopening, we could see strong payroll gains next month,” said Koichi Fujishiro, senior economist at Dai-ichi Life Research.
Despite solid data, U.S. bond yields fell, driven in part by Japanese buying, as they have begun a new fiscal year this month.
The U.S. Treasury’s ten-year yield fell to 1.529%, a five-week low, on Thursday and stood at 1.578%, below the 14-month high of 1.776% established at the end of March.
“The market has already had a full price on the U.S. economic recovery in the short term. And if the Federal Reserve keeps interest rates suspended for the next two to three years, there will no doubt be the transportation of North Americans would be very attractive compared to the Japanese or eurozone bonds, “said Chotaro Morita, SMBC Nikko Securities’ chief fixed income strategist.
The fall in long-term bond yields benefited equities, and in particular technology equities, given the idea that their historically costly valuations can be justified because investors would have no choice but to buy shares to offset low bond yields. .
On Wall Street, the S&P 500 (.SPX) was up 1.11%, while the Nasdaq Composite (.IXIC) was up 1.31%, reaching a record high in February.
In the foreign exchange market, the lower yields in the United States affected the US dollar.
The euro stood at $ 1.1951, after hitting a six-week high of $ 1.19935 overnight, while the US currency fell to a three-week low of 108.61 yen and last traded at 108.89.
Gold also hit a seven-week high of $ 1,769 an ounce and was last at $ 1,765.50.
Oil prices hit a one-month high in higher demand forecasts from the International Energy Agency (IEA) and OPEC, in addition to positive data from the US and China.
Brent futures gained 0.6% to $ 67.37 a barrel, while US crude rose 0.55% to 63.81 a barrel, both on track to gain their first substantial weekly gains in six.
Our standards: the principles of trust of Thomson Reuters.