World stock markets inched higher yesterday, lifted by gains in Europe amid sturdy corporate earnings and signs of economic strength, while US stock indexes were little changed ahead of a policy meeting of the US Federal Reserve.
IHS Markit’s Manufacturing Purchasing Managers’ Index for the euro zone jumped to 56.7 in April, its highest level since April 2011, as demand remained strong despite rising prices.
BP shares rose 2.1 per cent after the oil major’s first-quarter profit tripled.
Shares of Apple were up 0.9 per cent in morning trading ahead of its results after the closing bell yesterday. Gains in Mastercard, which was up 2.2 per cent, were offset by a 1.8 per cent decline in Pfizer after both companies posted earnings.
Robust results have helped lift share prices across the globe this year. First-quarter profits of companies on the benchmark S&P 500 index are expected to have risen 13.6 per cent, the strongest rise since 2011, according to Thomson Reuters data. Those of their European counterparts are seen up 13.9 per cent.
The Dow Jones Industrial Average rose 3.93 points, or 0.02 per cent, to 20,917.39, the S&P 500 lost 0.71 points, or 0.03 per cent, to 2,387.62 and the Nasdaq Composite dropped 0.74 points, or 0.01 per cent, to 6,090.86.
The pan-European FTSEurofirst 300 index rose 0.54 per cent and MSCI’s gauge of stocks across the globe gained 0.17 per cent.
The US dollar hit a six-week high against the Japanese yen as traders discounted recent weak US economic data and anticipated that the Federal Reserve would prepare markets for an interest rate increase in June in its statement following a policy meeting this week.
The yen weakened 0.24 per cent versus the greenback to 112.12 per dollar.
The Fed is expected to hold interest rates steady after its two-day meeting this week as it pauses to examine more economic data, but may hint it is on track for an increase in June.
Traders do not anticipate a hike today but are currently forecasting a 65.2 per cent chance of a 25 basis point hike at the Fed’s June meeting, according to Thomson Reuters data.
Benchmark 10-year notes last rose 5/32 in price to yield 2.3108 per cent, from 2.327 per cent late on Monday, ahead of the statement from the central bank yesterday.
Oil prices steadied as lower production by Russia and major OPEC exporters balanced news of higher output in the United States, Canada and Libya.
US crude fell 0.55 per cent to $48.57 per barrel and Brent was last at $51.31, down 0.41 per cent on the day.
Gold touched a three-week low of $1.257.37 an ounce as demand for the safe-haven asset waned. Spot gold dropped 0.1 per cent to $1,254.76 an ounce. US gold futures per cent to $1,255.50 an ounce.