Back to the Blog Main Page
05/06/24
217
Global Stocks Higher on Rate Cut Bets Ahead of ECB Meeting
On Wednesday global shares were higher as investors focused on the next European Central Bank policy meeting after soft U.S. labor market data that solidified up bets of a Federal Reserve interest rate cut in September.
Investor hopes that decreased interest rates — which can boost stock markets — are on the table were bolstered further after the Canadian central bank reduced interest rates by 0.25% for the first time in 4 years.
The MSCI’s global shares index, tracking shares in 49 nations, was 0.3% higher, supported by gains in Europe and Asia.
The Nasdaq Composite Index rose 0.7%, the Dow Jones Industrial Average fell 0.4% and the S&P 500 index was up 0.2%.
The ECB’s next meeting is on Thursday, and money markets are pricing in an almost 100% probability of the first cut in interest rates. There is however no certainty about the future path of rates in the eurozone.
Wednesday’s data showed eurozone business activity in May expanded at the quickest rate in a year as a contraction in manufacturing was outpaced by growth in the services industry.
The STOXX 600 pan-European index was 0.6% higher and the MSCI’s widest index of Asia-Pacific shares excluding Japan gained 1%. The Nikkei in Tokyo dropped 0.9%.
Promotions
