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Stock markets trend higher amid little macro guidance

With a lack of macroeconomic data or company earnings to throw markets off course to start the week, equity markets around the globe continued their recent upward trend. The major indices in the US and Europe were in positive territory on Monday, while Asia stocks outside of China made solid gains on Tuesday.

Date
Auteur
Shane Strowmatt, LGT
Temps de lecture
5 minutes

Candlesticks
© Shutterstock

Looking beyond stocks, most markets were calm early in the week. Interest rates moved little as trader were awaiting comments from the world’s key central bankers at the end of the week at the Economic Policy Symposium in Jackson Hole, USA. Yields on two-year treasuries were trading under 4.1%, while ten-year yields were below 3.9%. Gold was stable to start the week as well, trading near USD 2500 per ounce, while oil slipped slightly as the market began pricing in a higher probability of a ceasefire deal in Gaza. Israeli Prime Minister Benjamin Netanyahu has agreed to a proposal from Washington to resolve issues hindering a ceasefire agreement in Gaza, but Hamas has yet to accept the deal.

China keeps key rates steady

The People’s Bank of China left its one-year and five-year loan prime rates unchanged on Tuesday. The one-year rate, which is used for corporate and household loans, remains at 3.35%, while its five-year loan prime rate, which is used as a peg for property loans, stands at 3.85%. Last month, China surprised markets by cutting both the one-year and five-year rates by 10 basis points each. Hong Kong's Hang Seng Index was trading 1.1% lower after the announcement, while the mainland CSI 300 was down 0.9% on Tuesday.

Japanese equities bounce back

Elsewhere in the Asia-Pacific region, stocks were trading in positive territory with Japanese stocks leading gains. In Tokyo, the Nikkei 225 was trading more than 2% higher after tumbling the day before. South Korea’s Kospi was up 0.9% supported by strong consumer sentiment data. Also published on Tuesday were the Reserve Bank of Australia's August meeting minutes, which indicated that the current cash rate of 4.1% is expected to remain unchanged in the short term, given the slow pace of disinflation and persistent inflationary pressures. Australia’s S&P/ASX 200 was trading 0.2% higher on Tuesday.

US stocks continue higher

In New York, stock indices continued to push higher to start the week amid a lull in macroeconomic data releases. The Dow Jones Industrial closed 0.6% higher, the S&P 500 gained 1% and the Nasdaq-100 finished Monday’s session up 1.3%.

In individual stocks, AMD advanced 4.5% on Monday. In a strategic move to enhance its AI hardware portfolio, AMD announced plans to acquire server manufacturer ZT Systems for USD 4.9 billion. The integration of ZT Systems is expected to expedite the deployment of AMD's AI GPUs, crucial for meeting the demands of major cloud computing clients like Microsoft.

Corporate and macroeconomic calendars

Corporate news in focus: Quarterly figures from Alco, PSP Swiss Property, Lowe’s, Medtronic.

Economic data in focus: Swiss trade balance, German Producer Price Index, Riksbank interest rate decision, euro-area consumer prices, Swiss National Bank Chairman Thomas Jordan speaks in Schwyz, Canadian Consumer Price Index.

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.

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