FYI: Global stocks rose Wednesday following a surge on Wall Street after Federal Reserve officials hinted at the possibility of lowering interest rates to boost the economy.
In Europe, the Stoxx Europe 600 was up 0.3% in morning trade, as were Germany’s DAX and the U.K.’s FTSE 100.
France’s Dassault Aviation was among the biggest gainers on the pan-European index, rising almost 5% after Goldman Sachs upgraded the stock.
The gains in Europe followed a positive session in Asia, with Hong Kong’s Hang Seng Index up 0.5%, Korea’s Kospi index up 0.1% and Japan’s Nikkei jumping 1.8% higher.
Futures pointed to opening gains in the U.S., with the S&P 500 and the Dow Jones Industrial Average poised to rise 0.3%.
The blue-chip indexes had their best day in five months Tuesday, climbing more than 2% after supportive commentary from Federal Reserve officials buoyed investor confidence, which has been hit by concerns over Washington’s trade disputes in recent months.
Fed Chairman Jerome Powell said the central bank was monitoring the recent escalation in trade tensions and indicated it would act appropriately to sustain U.S. economic expansion. Investors took his comments to be a reference to a forthcoming rate cut. Lower interest rates reduce borrowing costs for businesses, stimulating investment.
Elsewhere, the World Bank lowered its outlook for global growth, noting that international trade and investment flows dropped faster than expected in the first six months of the year, curtailing economic activity. Global economic growth is on track to be the weakest since 2016, while trade growth is set to be the weakest since the financial crisis more than a decade ago, according to the bank’s forecasts.
The yield on 10-year U.S. Treasurys edged higher on Wednesday to 2.125%, from 2.119% on Tuesday. Yields on German 10-year bunds were at minus 0.207%, having earlier hit a fresh low of minus 0.224%.
Bond yields, which move in the opposite direction to prices, have come under pressure in recent months as investors pursued low-risk assets like government debt. Mr. Dixon said the cautious mood is likely to persist and there is scope for Treasury yields to decline further, particularly if the Fed goes ahead with the expected interest-rate cuts.
“The economic cycle [is] looking long in the tooth and there are residual concerns surrounding trade. It’s not a fantastic environment to invest heavily in equities so investors will remain cautious,” he said.
The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, was down 0.1%.
In commodities, global oil benchmark Brent crude fell 0.9% to $61.42 a barrel, while gold gained 0.7%.
Regards
Ted
MarketWatch:
https://www.marketwatch.com/story/dow-poised-to-extend-powerful-rally-driven-by-hope-of-the-fed-cutting-interest-rates-2019-06-05/printWSJ:
https://www.wsj.com/articles/global-stocks-edge-up-after-wall-street-surge-11559720521Bloomberg:
https://www.bloomberg.com/news/articles/2019-06-04/stocks-in-asia-to-rally-as-fed-signals-ready-to-act-market-wrap?srnd=premiumIBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-stock-market-rally-salesforce-stock-pivotal-stock-rewalk-robotics-fda-ok/CNBC:
https://www.cnbc.com/2019/06/05/stock-market-us-futures-signal-more-gains.htmlReuters:
https://uk.reuters.com/article/us-global-markets/global-stocks-gain-in-feds-cheery-slipstream-dollar-subdued-idUKKCN1T605IU.K.
https://uk.reuters.com/article/uk-britain-stocks/ftse-100-gains-as-fed-hints-at-rate-cut-provident-surges-idUKKCN1T60O2Europe:
https://www.marketwatch.com/story/european-markets-rise-as-central-banks-come-to-the-rescue-2019-06-05/printAsia:
https://www.marketwatch.com/story/nikkei-leads-asian-market-gains-following-wall-streets-rally-2019-06-04/printBonds:
https://www.cnbc.com/2019/06/05/bond-market-treasury-yields-focus-on-fed-comments.htmlCurrencies:
https://www.cnbc.com/2019/06/04/forex-market-fed-rate-cut-expectations-us-trade-tensions-in-focus.htmlOil:
https://www.cnbc.com/2019/06/05/oil-markets-us-crude-inventories-rosneft-comments-in-focus.htmlGold:
https://www.cnbc.com/2019/06/05/gold-markets-fed-rate-cut-expectations-dollar-in-focus.htmlCuirrent Futures:
https://finviz.com/futures.ashx 
