European Shares Likely To Extend Rally On Earnings Optimism
European stocks look set to extend gains for a fourth day running on Wednesday amid speculation the worst of inflation may be over.
Tech stocks are likely to benefit as Netflix Inc. reported a smaller-than-expected subscriber loss and reports suggested that regulators are wrapping up a yearlong probe into ride-hailing giant Didi Global Inc. with a hefty fine — stoking hopes of an end to an intense crackdown on the sector.
Meanwhile, China kept its benchmark lending rates for corporate and household loans unchanged after June economic data pointed to signs of economic recovery.
The euro extended its overnight bounce to hold around a two-week high on speculation the European Central Bank may consider raising interest rates by a larger-than-expected 50 basis points on Thursday.
Bank of England governor Andrew Bailey also raised the possibility of increasing interest rates by half a percentage point in early August.
Elsewhere, the Bank of Japan is widely expected to keep monetary stimulus unchanged on Thursday to avoid deflation.
Asian markets followed Wall Street higher, while oil prices fell around 1 percent after a three-day rally. Gold dipped on higher bond yields ahead of central bank decisions.
Consumer and factory gate price data from the U.K. are due later in the session, headlining a light day for the European economic news.
U.S. stocks rose sharply overnight as more companies reported better-than-expected earnings, offsetting worries about inflation and interest-rate hikes.
The Dow surged 2.4 percent, the tech-heavy Nasdaq Composite jumped 3.1 percent and the S&P 500 spiked 2.8 percent despite signs the housing market is slowing from its torrid pace.
European stocks extended gains for a third straight session Tuesday on relief Europe might be able to avoid the worst fears concerning energy shortages.
The pan European Stoxx 600 advanced 1.4 percent. The German DAX gained 2.7 percent, France’s CAC 40 index surged 1.8 percent and the U.K.’s FTSE 100 added 1 percent.
Source: Read Full Article