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Markets Buoyed By Optimism

By Antonio FerlitoStock MarketsApr 08, 2021 06:34AM ET
Markets Buoyed By Optimism
By Antonio Ferlito   |  Apr 08, 2021 06:34AM ET
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Stocks in Europe reached record highs on Thursday, buoyed by optimism in Britain over easing lockdown restrictions, while a benign outlook for US interest rates was set to push Wall Street to new heights.

The European STOXX 600 index of leading companies rose 0.3%, hitting a new high of 436.66 points. London's blue chip FTSE 100 index was up 0.2%.

"It's looking good as evaluations in Europe are much lower than they are in the U.S. so there is potentially more upside. The line of least resistance for European markets is higher," said Michael Hewson, chief market analyst at CMC Markets.

"In terms of economic re-opening, there is enough optimism built in at the moment to drive markets quite a bit higher from here, and the Fed has reiterated it's going to remain on hold for a while," Hewson added.

Minutes of the Federal Reserve's last policy meeting, published on Wednesday, showed members felt the economy was still far short of target and were in no rush to scale back their $120 billion a month of bond buying.

Fed Chairman Jerome Powell speaks at an International Monetary Fund event later on Thursday and is likely to reiterate the dovish outlook.

The European Central Bank is due to publish accounts for its Mar. 11 policy meeting amid debate about when it should start tapering its pandemic stimulus, with the euro area recovery still in doubt.

Wall Street was also set to reach fresh peaks on Thursday with e-mini futures on the S&P 500 rising 0.35% after rising to a record high, and Nasdaq futures up 0.7%

Gains by U.S. Treasuries also helped, although analysts said markets will be tested next week when the U.S. earnings seasons gets underway.

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In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan inched up 0.3% in quiet trade.

Japan's Nikkei slipped 0.3%, not helped by news Tokyo's governor had asked for emergency measures to stem a surge of COVID-19 infections.

Yields on 10-year Treasuries have eased back to 1.669% from the recent 14-month high of 1.776%, but have struggled to break under 1.59%.

The decline coincided with a dip in the dollar index to 92.360 from its recent five-month high at 93.439.

The euro was steady at $1.1871 , after rising as high as $1.1914 overnight following a surprisingly upbeat survey of European Union business activity.

In commodity markets, gold was at $1,743 an ounce after meeting resistance around $1,745.

Oil prices fell after official figures showed a big increase in US gasoline stockpiles, causing concerns about demand for crude weakening in the world's biggest consumer of the resource at a time when supplies around the world are rising.

Source: Reuters

Markets Buoyed By Optimism

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Markets Buoyed By Optimism

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