NEW YORK: US stocks have risen sharply, led by gains across sectors as investors bet that Federal Reserve chair Jerome Powell will stick to a gradual rate-hike approach despite indications that inflation is picking up.
Powell faces questions from both houses of the US Congress in a semi-annual testimony starting on Tuesday, his first major set piece since he took over from Janet Yellen earlier in February.
His testimony comes at a time when investors have been anxious about the pace of rate hikes, which have weighed on equity markets globally. The Fed said on Friday it expected economic growth to remain steady and saw no serious risks on the horizon that might pause its planned pace of rate hikes.
The US 10-year Treasury yields eased to 2.8587 per cent , slipping from the four-year high it hit last week, while the CBOE Volatility index, known as Wall Street’s fear gauge, was last at 16.12. At 3.10 pm Monday ET (0710 Tuesday AEDT), the Dow Jones Industrial Average was up 1.52 per cent, at 25,695.26, the S&P 500 was up 0.97 per cent, at 2,773.89, and the Nasdaq Composite was up 1.06 per cent, at 7,414.84.
LONDON: European shares rose on Monday, with gains across bourses and industry sectors, as the focus gradually shifts from the earnings season to monetary policy and politics with Italy’s election on Sunday.
Shares gave up some of their gains after comments by European Central Bank president Mario Draghi suggested the bank was still confident that inflation was on an upward trend, supporting market expectations for the bank to finally end its bond purchase program this year.
The pan-European STOXX benchmark index closed up 0.6 per cent at 383.34 points. A number of shares which investors have often bet against enjoyed strong gains without any corporate announcement to justify the rise.
Germany’s DAX closed 0.35 per cent higher at 12,527.04.
Britain’s top share index rallied on Monday, shaking off last week’s slight decline as firmer commodity stocks and Associated British Foods propped up the FTSE.
The blue chip FTSE 100 index closed up 0.62 per cent at 7,289.58 points, while mid-caps gained 0.1 per cent.
While individual moves on the FTSE were mostly muted, mining stocks led the gainers with shares in Anglo American, precious metals miner Randgold Resource and silver miner Fresnillo rising between 1.3 per cent to 3.1 per cent as underlying metals prices gained.
TOKYO: Asian stocks also gained, with most of the major indexes rising more than one per cent.
Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.7 per cent, while Japan’s Nikkei index closed up 1.19 per cent at 22,153.63.
Hong Kong’s Hang Seng also closed firmly in the green, up 0.74 per cent at 31,498.60.
China stocks extended gains, with major indexes climbing for a sixth session in a row, led by start-ups which saw their best day in seven months on expectations they will benefit from a proposal to delay reforms for initial public offerings (IPOs).
China’s top securities regulator Liu Shiyu proposed to delay a deadline for the government to authorise a registration-based initial public offering mechanism until February 29, 2020, the official Xinhua News Agency reported on Friday.
Market participants were also keeping a close watch on the impact of certain amendments in the wording of China’s constitution.
China’s ruling Communist Party on Sunday set the stage for President Xi Jinping to stay in office indefinitely, with a proposal to remove a constitutional clause limiting presidential service to just two terms in office.
The Shanghai Composite index closed up 1.23 per cent at 3,329.57, while the blue-chip CSI300 index rose 1.16 per cent to 4,118.42.