Trade talks between the U.S. and China are showing signs of improvement, boosting overall investor sentiment
Global stock markets displayed broadly positive momentum on Tuesday, as investors absorbed signals from the U.S. Federal Reserve about possible interest rate pauses, strong ongoing corporate earnings expectations, and easing U.S.-China trade tensions. Key equity benchmarks in the United States, Europe, and Asia mostly advanced, supported by an improved risk appetite despite lingering geopolitical and economic uncertainties.
U.S. markets steady gains with earnings momentum
U.S. stock markets ended Tuesday significantly higher, rebounding from some volatility earlier this month sparked by worries over regional bank loans and a U.S. government shutdown. The benchmark S&P 500 index rose 1.07 percent to close at 6,735.13 points, continuing a month-long upward trend with robust third-quarter earnings forecasts providing fresh impetus for gains. The Dow Jones Industrial Average added 1.12 percent to finish at 46,706.58, while the tech-heavy Nasdaq Composite surged 1.37 percent to 22,990.54 points.
Investor optimism is buoyed by projected 9.3 percent year-on-year earnings growth for the S&P 500 this quarter, higher than earlier estimates. Anticipation of earnings reports this week from influential companies such as Tesla, Netflix, IBM, and Intel also underpin confidence. Further supporting sentiment is the Federal Reserve’s cue toward a possible pause in interest rate hikes and speculation about rate cuts in upcoming meetings, tempering previous concerns about restrictive monetary policy.
Wall Street futures were slightly higher late Monday, signaling cautious optimism ahead of the earnings deluge. The market’s volatility index (VIX) remains relatively elevated but has pulled back from recent highs, reflecting a more stable risk environment.
European stocks mixed but mostly up
European stock markets showed mixed performances early Tuesday, with notable gains in Germany’s DAX index, which climbed 1.8 percent to 24,258.80, the strongest among major European bourses. The U.K.’s FTSE 100 increased 0.52 percent to 9,403.57 points, while France’s CAC 40 edged up 0.39 percent to 8,206.07.
The Euro Stoxx 50 index, a key blue-chip gauge for the Eurozone, traced a moderate gain, closing slightly higher — recent data places it at around 5,680 points — buoyed by optimism over economic data and slower inflation pressures in the region. The European markets are digesting slowing energy prices and cautiously watching corporate earnings. However, ongoing geopolitical tensions and inflation uncertainties keep investors measured.
Read more | Stock market today: Japan’s Nikkei soars to new highs, U.S. cautious, Euro Stoxx dips
Asian markets rally led by Nikkei record highs
Asian stock markets recorded robust advances, particularly Japan’s Nikkei 225, which hit a fresh record high, gaining 0.79 percent to 49,575.78 points on Tuesday. The Japanese rally continues to be propelled by expectations of a new coalition government and the historic appointment of Sanae Takaichi as Japan’s first female prime minister. Investors are betting on increased fiscal stimulus and sustained loose monetary policy under the new leadership, benefiting technology and industrial sectors.
Other key Asian indices included China’s Shanghai Composite, which edged up 1.2 percent to 3,910.13 points, and the Shenzhen Component, rising 1.97 percent. Hong Kong’s Hang Seng Index surged 1.65 percent to 26,286.47, reflecting optimism after a recent dip tied to trade tensions. Australia’s S&P/ASX 200 climbed 0.62 percent to 9,087.90, and Singapore’s Straits Times rose 1.39 percent to 4,389.03, underlining the broadly positive mood across Asia.
Trade negotiations between the U.S. and China are showing tentative signs of improvement, which is bolstering investor sentiment in the region. However, watchfulness remains over global economic growth prospects and potential fluctuations in currency markets.
AloJapan.com