European stocks and commodities rallied after better-than-expected economic data in China fueled hopes stimulus measures are paying off. The euro headed for a record run of weekly declines.
(Bloomberg) — European stocks and commodities rallied after better-than-expected economic data in China fueled hopes stimulus measures are paying off. The euro headed for a record run of weekly declines.
Europe’s Stoxx 600 added 0.9%, following Asian peers higher, after Chinese industrial production and retail sales statistics beat estimates. Brent crude climbed above $94 per barrel.
Bets that the European Central Bank’s tightening cycle is over sent the euro toward its ninth straight week of losses, the longest run since it was created over two decades ago. Attention now turns to the Federal Reserve’s meeting next week after strong data Thursday revived speculation policy makers can engineer a soft landing and keep rates on hold.
“It looks like ‘happy hour’ for the market,” said Guillermo Hernandez Sampere, head of trading at asset manager MPPM. “To confirm the bull case, high cash piles must find their way into markets, and next week the Fed could send signals to initiate such action.”
The dollar edged lower versus most major peers and Treasury yields ticked higher.
US equity futures, meanwhile, pared gains as General Motors Co., Ford Motor Co. and Stellantis NV stumbled in premarket trading. The United Auto Workers began an unprecedented strike at each of the three legacy Detroit carmakers, setting the stage for a protracted showdown.
Markets were also braced for Friday’s triple witching options event — which has the potential to trigger volume spikes and volatility.
Arm Holdings Plc rallied in premarket trading, pointing to more gains after a 25% pop in its trading debut. The chip designer raised $4.87 billion in the year’s biggest initial public offering, delivering a boost to the tech sector.
The Chinese data showed the economy picking up steam in August as a summer travel boom and a heftier stimulus push boosted consumer spending and factory output.
“The improvement in industrial production and retail sales is encouraging,” said Frances Cheung, a rates strategist at Oversea-Chinese Banking Corp. in Singapore. “Recent economic data point to some stabilization.”
Key events this week:
- US industrial production, University of Michigan consumer sentiment, Empire Manufacturing index, Friday
Some of the main moves in markets:
- The Stoxx Europe 600 rose 0.8% as of 10:06 a.m. London time
- S&P 500 futures were little changed
- Nasdaq 100 futures were little changed
- Futures on the Dow Jones Industrial Average rose 0.2%
- The MSCI Asia Pacific Index rose 0.6%
- The MSCI Emerging Markets Index rose 0.4%
- The Bloomberg Dollar Spot Index was little changed
- The euro rose 0.2% to $1.0666
- The Japanese yen fell 0.2% to 147.76 per dollar
- The offshore yuan rose 0.1% to 7.2802 per dollar
- The British pound rose 0.2% to $1.2438
- Bitcoin rose 0.2% to $26,625.4
- Ether was little changed at $1,628.34
- The yield on 10-year Treasuries advanced three basis points to 4.32%
- Germany’s 10-year yield advanced five basis points to 2.65%
- Britain’s 10-year yield advanced six basis points to 4.34%
- Brent crude rose 0.3% to $93.97 a barrel
- Spot gold rose 0.4% to $1,918.27 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Andrew Janes and Matthew Burgess.
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