Global markets are moving up on Thursday amid positive US earnings, as well as optimism about trade negotiations between the US and China helping underpin investor sentiment.
White House Economic Adviser Larry Kudlow denied rumours that the meeting with the Chinese officials was cancelled, saying no additional talks were planned before the visit of China’s Deputy Prime Minister Liu He next week.
On Monday, the International Monetary Fund lowered its forecast for the global economy by predicting it would grow in 2019 at its weakest pace in three years, and warned that trade pressures in recent months would cause further problems. With its second lowering of the economic growth forecast in the past three months, the organization accused the negative trend of predominantly declining consumption in Europe and the recent turmoil in financial markets.
The fund predicts global growth of 3.5% this year, below the previous forecast of 3.7%, made in October.
On the other hand, German Chancellor Angela Merkel said that reforms are needed in the IMF and the World Bank in order to restore confidence in the global financial system.
Today the investors will carefully watch the European Central Bank meeting on its monetary policy, with economists expecting no change in its interest rates.
Asian markets recap
Most of the stock indexes in the Asia-Pacific region ended today’s trading session with increases despite low forecasts for the global economy.
In China, the continental index Shanghai Composite added 0.41% to its value and ended the day at 2,591.69 points. Hong Kong’s index Hang Seng rose by 0.31% to 27,091.33 points.
On the Tokyo Stock Exchange, the blue-chip index Nikkei 225 dropped by 0.09% to 20,574.63 points. Earlier, it became clear that Japan Display, which is the main supplier of the US technology company Apple, is negotiating financial assistance due to the disappointing sales of the iPhone XR. This pushed the Japanese company’s shares up, but in today’s session, their value fell by 5.26%.
In South Korea, the index Kospi reported a growth of 0.81% to 2,145.03 points. The stocks of the microprocessor maker SK Hynix appreciated by 5.54% despite the lower-than-expected quarterly report.
The Australian index S&P ASX 200 rose by 0.38% to 5,868.70 points, with energy companies adding more than 2% to the value of their securities. In Australia, employment data for December was published, which surpassed the expectations of the analysts. In the last month of 2018, a total of 21,600 new jobs were created, which is more than originally projected growth of 16,500. The unemployment rate reached 5.0% against the expected 5.1%. The labour market in Australia is currently quite strong, which will support the country’s economy.
European markets mid-session recap
German stocks are on the rise today with DAX 30 index growing by 0.45% to 11,121.53 points at 12:55 GMT. Automakers were moving higher ahead of high-level talks between the US and China next week. The stocks of BMW rose by 0.8%, Daimler rallied 1.1% and Volkswagen added 0.6%. Osram Licht dropped by 0.6% after its revenue for the first quarter of fiscal 2019 from continuing operations declined 15% on a comparable basis. Fresenius jumped 4.4% after BAML upgraded the stock rating to “buy”.
The FTSE 100 was subdued ahead of European Central Bank’s monetary policy meeting despite expectations that interest rates will remain unchanged Around midday, the blue-chip index dipped 0.02% to 6,841.47 at around midday. Anglo American shed 0.8% after it said Thursday it expected copper and diamond production to decline in 2019. Wealth management group St James’s Place gained 2.6% to 966p despite reporting on Thursday declining inflows in the fourth quarter of 2018 amid “particularly difficult market conditions”.
French stocks rose on Thursday, although overall gains remained capped by fears over slackening global growth. The main index CAC 40 is up by 0.7% to 4,874.07 points at 12:55 GMT. Payments company Ingenico rose over 1%, a day after posting weak earnings results. Automaker Renault gained 0.9% and Peugeot rallied nearly 2% ahead of high-level talks between the US and China next week. Shares of STMicroelectronics NV surged 8.5% after the Geneva-based semiconductor company reported earnings and revenues in its fourth quarter above market estimates. AccorHotels advanced 1.5% after confirming results of the tender offer for Orbis shares.
Wall Street pre-session recap
The US stock index futures fluctuated ahead of Thursday’s open after US markets posted strong gains in the previous session.
Around 8:00 a.m. ET, Dow Jones Industrial Average futures rose 32 points, indicating a higher open of 35.38 points. S&P 500 and Nasdaq 100 futures also pointed to slight gains at the open with 5.15 points and 34.99 points, respectively.
On Thursday, a slew of corporate earnings are expected to have an influence on the market agenda. Some of the major names set to report include Bristol-Myers Squibb, Union Pacific, American Airlines Group, Southwest Air, Intel, Starbucks, Alaska Air, Discover Financial and Western Digital.