Global stocks rose in trading on Friday, as investors looked forward to the University of Michigan’s survey of consumer confidence, which also includes closely watched inflation expectations, amid further signs that inflation in the United States has slowed.
Performance of some of the most popular stock indices today:-
- The Japanese Nikkei 225 index rebounded in Tokyo to gain 2.62%, equivalent to 727.65 points, to close at 28,546.98.
- On the other hand, the Chinese Shanghai Composite Index (SHCOMP) declined, recording a loss of -0.15%, equivalent to -4.78 points, to close at 3,276.89.
- The Hang Sang Index (HSI) in Hong Kong rose by 0.46%, or 93.19 points, to close at 20,175.62.
- By 11:15 GMT, the Euro Stoxx 50 index (SX5E) for all of Europe rose by 0.11%, equivalent to 4.12 points, to settle at the level of 3,761.17.
- The German DAX index also advanced, achieving a gain of 0.41%, equivalent to 56.54 points, to settle at 13,751.04.
- The Financial Times 100 Index (FTSE 100) in the United Kingdom increased, achieving a gain of 0.25%, equivalent to 19.54 points, to settle at the level of 7,484.44.
Dow Jones Industrial Average futures rose 105 points, or 0.3%, S&P 500 futures rose 0.4%, and Nasdaq futures rose 0.5%.
After a week full of upbeat news on both consumer price inflation and producer prices, investors are waiting for the next data points – July import prices followed by the University of Michigan Preliminary Consumer Confidence Index for August.
The UMich survey also includes 5-year inflation expectations, data that Federal Reserve Chairman Jerome Powell cited as an important indicator in shaping monetary policy.
Strategists expect a slight improvement in sentiment, thanks to lower gasoline prices, which on Thursday fell below $4 a gallon for the first time in months.
Meanwhile, San Francisco Federal Reserve President Mary Daly said it was too early to “declare victory” over inflation in the US, in an interview with the Financial Times published on Thursday. But Daly said a 50 basis point increase remains the key issue for the Fed’s next meeting in September. Daly is not a voter on the FOMC this year.
Activity on fed money futures assesses a 65% probability of a 50 basis point rate hike in September, meaning there is now plenty of room to reverse those expectations, especially if energy prices rise again a bit and could easily bring the Fed’s hawks back into the market. It changes the mood.
Chicago Fed President Charles Evans and Minneapolis Fed President Neil Kashkari this week also signaled rates well above 3% this year.
Separately, European shares hit a two-month high, before paring gains to trade 0.12% down. Britain’s FTSE UK100 Index rose and was eyeing two-month highs.
The 10-year US Treasury yield was trading at 2.869% after hitting a three-week high of 2.906%.
German benchmark 10-year government bond yields briefly rose above 1% for the first time in two weeks.