European stocks at record on tech and ECB bets
The pan-European STOXX 600 benchmark rose by 0.7%, with the technology subindex surging 2.6%, driven by significant gains from Wall Street's tech giants.
surged to a new , boosted by the continued rally in and an anticipated from the on Thursday.While the pan-European added 0.7%, the technology subindex rallied as much as 2.6%, following steep gains for ’s behemoths. also edged higher, indicating another all-time peak for the S&P 500. In US premarket trading, , advanced almost 2%, having surpassed $3 trillion in on Wednesday, the first computer chip company to reach that milestone.
Other US tech firms, including and , also rose in premarket trading, while in Europe, ASML Holding NV and ASM International NV surged to new record peaks.
“Behind a lot of the optimism that you’re seeing in markets, technology is still continuing to lead the pack,” said Matt Stucky, a senior portfolio manager at Northwestern Mutual Wealth Management. “Earnings revisions are favoring tech and that’s showing in terms of stock market leadership.”
The tech optimism coincides with growing confidence among investors that central banks across the developed world will be able to ease monetary policy this year. The should deliver a 25 basis-point cut on Thursday, after the Bank of Canada kicked off its cutting cycle and hinted at more easing to come. Traders have also started to price more Federal Reserve easing this year.
“With the Bank of Canada cutting rates and the expectation ECB will do so, momentum behind a coordinated global easing cycle is starting to gain some traction,” Stucky said.
Bond yields across Europe ticked higher ahead of the meeting, as traders awaited more guidance on the path for additional easing from ECB President Christine Lagarde. Wagers on further ECB cuts have turned more cautious in the wake of data showing stronger-than-anticipated economic growth, inflation and wage increases.
Treasury yields also inched higher after falling in the previous session, with markets almost fully pricing in two Fed rate cuts in 2024. While a private payrolls reading on Wednesday showed hiring at companies grew at the slowest pace since the start of 2024, the services sector expanded by the most in nine months. Friday’s key monthly payrolls data is expected to show job creation ticking up in May after April’s surprisingly soft figure.
Earlier in Asia, stocks rose for the first time in three days, with Indian equities extending gains after Prime Minister Narendra Modi won crucial backing from two key allies in his coalition. Taiwan Semiconductor Manufacturing Co. rose as much as 7.4% to a new record high the chip giant announced a share buyback.
In commodities, oil rose for a second session, while copper led a rally in industrial metals prices, while zinc and nickel also gained.
Source: Stocks-Markets-Economic Times
