Global stocks edged higher on Friday, boosted by positive investor sentiment after China hinted of plans to spur economic growth while chipmaker stocks in the region propped up markets, helped by solid earnings news from US counterparts.
China’s state planner said it will roll out a plan to boost disposable income this year and in 2020 to encourage consumption as the economy slows.
Investors are closely monitoring US bond yields. The yield on 30-year bonds on Thursday dropped to a record low of just over 2%. At the same time, yields on 10-year bonds touched a 3-year low and reached 1.5521%. The yield on US government bonds inverted on Wednesday for the first time since 2007 as a sign that the world’s largest economy may be in recession.
On the trade front, a spokesman for China’s foreign ministry said that Beijing hopes to move closer with the US on trade. The statement came after China said earlier that US customs duties were seriously disrupting the consensus reached by the two presidents at the G20 summit in June.
Asian markets recap
Asian stock exchanges were mixed on Friday, with investors’ focus on US bond yields and the development of the Sino-American trade war.
In China, the mainland index Shanghai Composite grew by 0.29%, while Shenzhen Component 0.57%. On the Hong Kong Stock Exchange, the index Hang Seng added 0.85% to its value at the close of trade. Shares of Ping An Insurance Group rose 2.52% after the company announced its strongest earnings growth for the first half on Thursday.
In Japan, the blue-chip index Nikkei 225 recovered from its earlier losses, ending the session with minimal growth of 0.06% to 20,418.81 points. The index fell to a 6-month low yesterday. The best performers of the session were Daiwa House Industry (+5.09%), Nomura Holdings (+4.93%) and Dainippon Screen (+4.20%), while on the flipside were Recruit Holdings (-3.12%), IHI Corp (-2.79%) and NKSJ Holdings (-2.17%).
In South Korea, the local index Kospi dropped by 0.58% with the shares of chipmaker SK Hynix declining by 0.65% and LG Chem’s ending down by 1.08%.
Australian benchmark S&P ASX 200 moved red by 0.04%.
European markets mid-session recap
European markets were sharply higher Friday morning, as investors tentatively returned to riskier assets after a turbulent week. The pan-European Stoxx 600 was up by 0.9% to 368.38 points, with all sectors and major bourses in positive territory. European shares staged a comeback from six-month lows hit during the previous session, after China warned of retaliation against U.S. tariffs, heightening fears of the continued impact of their trade war on global growth.
German index DAX 30 is up by 0.82% to 11,506.40 points at 09:45 GMT. The stocks of Deutsche Bank rose by 0.7%, while Commerzbank added 2.75%. Carmakers are also on the rise with Volkswagen and Daimler gaining 0.43% and 1.00%, respectively. Software giant SAP added 0.7%, while chemical company BASF is up by 0.6%.
French index CAC 40 adds 0.90% to 5,284.25 points at mid-session trading. The stocks of Renault are up by 0.5%, while Peugeot stalled with minimum decline. The shares of Airbus gained 0.5%.
British FTSE 100 gained 0.4% to 7,095.49 points after a technical glitch prevented it from opening for almost two hours.
Wall Street pre-session recap
Wall Street stock index futures were set to open sharply higher on Friday morning as investors continued to focus on movements in the bond market and US-China trade talks.
Around 6 a.m. ET, Dow futures indicated a positive open of about 250 points. Futures on the S&P and Nasdaq were also both solidly higher.
The investors will watch closely a reading on housing starts and building permits is due at 8:30 a.m. ET. Consumer sentiment numbers will be released at 10 a.m. ET. And OPEC is also expected to publish its monthly report.