American Stock Market Recovers from Last Week’s Plummet
Investors rushed back into global stock markets after U.S. producer prices verified an inflation deceleration and revived trust in the Federal Reserve’s ability to slow down its pace of interest rate hikes.
Treasury yields dropped by ten basis points, and contracts on the tech-heavy Nasdaq 100 increased by 3%. Chipmakers Advanced Micro Devices Inc., ON Semiconductors Nvidia Corp. saw significant premarket gains in U.S. trade. Amazon.com Inc. intends to cut around 10,000 positions, rising 3.3%. After consecutive 75 basis-point rate increases, markets recently shifted risk, trading off a softer-than-expected U.S. data print. Analysts believe this will pave the way for the Fed to raise rates in 50 basis-point steps.
Currently, several factors are working in the stock market’s favor. Stocks are currently in the year’s final stages, and they tend to do well at this time. According to last week’s inflation data, the Fed may delay its interest-rate increases next month. And sentiment towaweek’scks, often considered a contrarian signal, was particularly gloomy in the fourth quarter.
Chinese Equities Climb
China’s new plan to ease pressure on China’s market and COVID regulations positively impacted Chinese Stocks. It also had a massive impact on U.S. stock futures moving higher. After a 20% rise from a recent low, The Hang Seng of Hong Kong climbed 4.1%. So the index is currently back in the game. The Shanghai Composite in mainland China increased by 1.6%.
Chinese President Xi Jinping and U.S. President Joe Biden’s Monday encounter also sparked proBiden’sfor improved ties between the two superpowers. It followed Beijing’s announcement of a pro-property Beijing’sd the loosening of Covid restrictions.
The European Stock Market Also Sets out On an Uptrend
With better-than-expected third-quarter earnings and as the U.S. inflation slowed down in October, European equities trade at their highest level in three months. Concerns over hawkish central banks battling rising inflation and Europe’s energy crisis drove the sEurope’sket in the area downward this year.
According to a Bank of America Corporation fund manager survey, European equities are gaining popularity among investors. Related strategists found that 59% of investors expect further upbeat of European equities for the coming 12 months. But at the same time, 80% consider the current equity rally unsustainable.