At the end of yesterday, the Dow Jones Index (US30) gained 0.15%, while the S&P 500 Index (US500) rose 0.25% to an all-time high. The NASDAQ Technology Index (US100) closed positive 0.03%. Strengthening chipmakers helped boost the overall market on Tuesday, led by a 3% gain in Nvidia (NVDA) shares after Rosenblatt Securities raised its price target on the stock.

The US economic news on Tuesday was mixed for stocks. May retail sales rose less than expected and raised concerns about consumer spending. However, a stronger-than-expected manufacturing output report for May eased concerns about a slowdown in consumer spending. Fed comments on Tuesday were mostly on the hawkish side, as policymakers said they would prefer to wait to cut interest rates.

According to Fitch Ratings' latest estimate, global economic growth will strengthen this year and slow in 2025. The rating agency raised its prognosis for global GDP growth in 2024 to 2.6%, from its previous prediction of 2.4%. The revised outlook reflects Fitch's increased confidence in European economic recovery prospects, strengthening domestic demand in emerging markets (excluding China).

Equity markets in Europe were mostly up on Tuesday. Germany's DAX (DE40) rose by 0.35%, France's CAC 40 (FR40) closed 0.76% higher, Spain's IBEX 35 (ES35) jumped 0.99%, and the UK's FTSE 100 (UK100) closed positive 0.60%. The Eurozone's annual inflation rate for May 2024 was 2.6%, up from 2.4% in April. A year earlier, the figure stood at 6.1%. The lowest annual rates were recorded in Latvia (0.0%), Finland (0.4%), and Italy (0.8%). The highest annual rates were recorded in Romania (5.8%), Belgium (4.9%) and Croatia (4.3%). Compared to April, annual inflation fell in eleven Member States, remained unchanged in two, and rose in fourteen.

WTI crude oil prices held near $81.5 a barrel on Wednesday, at their highest levels in seven weeks, as the escalating conflict in Eastern Europe and the Middle East renewed supply concerns. In Russia, a Ukrainian drone strike sparked a fire at an oil terminal at a major port, while a senior Israeli official warned of a looming "all-out war" with Lebanon's Hezbollah. Oil prices were also supported by global demand growth estimates, with OPEC, the IEA, and the US EIA all predicting strong oil demand growth in the second half of this year.

Asian markets traded yesterday without any unified dynamics. Japan's Nikkei 225 (JP225) gained 1.00%, China's FTSE China A50 (CHA50) decreased by 0.09%, Hong Kong's Hang Seng (HK50) was down 0.11%, while Australia's ASX 200 (AU200) was positive 1.01%.

Hong Kong stocks rose in early trading on Wednesday, recovering from sluggish sessions in the previous two sessions as all sectors rose. The index approached its highest level in a fortnight as traders sought to take new positions following the Hong Kong government's announcement that markets in the Asian financial center will remain open during typhoons and extreme weather conditions from September 23. Investors are also awaiting the People's Bank of China's lending rate decision on Thursday after the Central Bank decided earlier this week to leave the medium-term lending rate unchanged at 2.5%.

The Reserve Bank of Australia took a hawkish tone in a press conference after this week's meeting, warning of upside risks to inflation. RBA Governor Michele Bullock also said the board discussed the need to raise the interest rate at its June meeting, while arguments for a rate cut were not considered. These comments came after the Central Bank left the money rate unchanged at 4.35% for the fifth consecutive meeting, as expected.

New Zealand's inflation rate has slowed significantly recently. However, it remains above both pre-pandemic levels and the Monetary Policy Committee's (MPC) target range of 1% to 3%. Compared to other countries, labor market shortages caused by the border closure have played an important role in driving up inflation in New Zealand. Recent research emphasizes that the emergence of spare capacity in the economy will lead to lower domestic inflation.

• S&P 500 (US500) 5,487.03 +13.80 (+0.25%)
• Dow Jones (US30) 38,834.86 +56.76 (+0.15%)
• DAX (DE40) 18,131.97 +63.76 (+0.35%)
• FTSE 100 (UK100) 8,191.29 +49.14 (+0.60%)
• USD Index 105.25 −0.07 (−0.06%)

Important events today:

• – Japan BoJ Monetary Policy Meeting Minutes (m/m) at 02:50 (GMT+3);
• – Japan Trade Balance (m/m) at 02:50 (GMT+3);
• – UK Consumer Price Index (m/m) at 09:00 (GMT+3);
• – UK Producer Price Index (m/m) at 09:00 (GMT+3).

More By This Author: