Europe’s main stock markets rose Friday after a tech-led Wall Street rally, but Asia was dented by China’s economic woes while London digested news of slumping UK retail sales.
Global equities had rebounded Thursday in choppy trade as investors assessed the outlook for US Federal Reserve interest rates and tech giants rebounded from recent losses.
All three major indices on Wall Street finished the day firmly in the black, spurred on by the tech-rich Nasdaq Composite index.
“Most stock market indices are in the green as bargain hunters enter the fray led by a stronger performance by chipmakers,” Rabobank analyst Jane Foley told AFP.
“Although reduced hopes for an early Fed rate cut has taken out some of the froth from stock markets this month, the resilience of the US economy should offer some support.”
US data on inflation and jobs, alongside comments from central bank officials, have combined with growing geopolitical tensions to dent equities in January, bringing a halt to an end-of-year rally.
The readings — showing consumer inflation topping expectations and a resilient labour market — show the world’s number one economy remained in rude health despite borrowing costs at two-decade highs.
And on Thursday, fresh figures pointed to a surprise slowdown in jobless claims, suggesting the Fed would likely have to keep rates elevated for some time to make sure inflation does not pop back up.
In light of the latest data, traders have lowered their bets on a March interest rate cut to a little more than 50 percent, down from 80 percent last week.
New York’s gains were largely driven by a surge in tech giants including Apple, Nvidia and Amazon after chip titan Taiwan Semiconductor Manufacturing Co unveiled a strong outlook for capital spending and revenue that boosted hopes for 2024.
TSMC jumped more than six percent in Taipei, tracking an almost 10 percent jump in its US-listed firms.
And other Asian tech firms were on the rise, with Tokyo Electron up six percent and Advantest surging more than eight percent in Tokyo, while Seoul-traded Samsung jumped more than four percent.
Tokyo stocks put on more than one percent thanks to the weaker yen as data showing Japanese inflation slowing eased pressure on the country’s central bank to shift away from its ultra-loose monetary policy.
However, worries over China’s economy continued to weigh on Shanghai and Hong Kong, which extended the year’s losses.
Data this week out of Beijing showing GDP growth at its weakest since 1990, outside the pandemic years, added to concerns officials are not doing enough to provide support.
– Key figures around 1115 GMT –
London – FTSE 100: UP 0.4 percent at 7,490.63 points
Paris – CAC 40: UP 0.1 percent at 7,407.85
Frankfurt – DAX: UP 0.3 percent at 16,612.42
EURO STOXX 50: UP 0.2 percent at 4,463.19
Tokyo – Nikkei 225: UP 1.4 percent at 35,963.27 (close)
Hong Kong – Hang Seng Index: DOWN 0.5 percent at 15,308.69 (close)
Shanghai – Composite: DOWN 0.5 percent at 2,832.28 (close)
New York – Dow: UP 0.5 percent at 37,468.61 (close)
Euro/dollar: DOWN at $1.0863 from $1.0883 on Thursday
Dollar/yen: UP at 148.21 yen from 148.16 yen
Pound/dollar: UP at $1.2689 from $1.2676
Euro/pound: DOWN at 85.61 pence from 85.84 pence
West Texas Intermediate: UP 0.9 percent at $74.22 per barrel
Brent North Sea Crude: UP 0.7 percent at $79.64 per barrel
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