Global Stocks Surge and Dollar Weakens: What Fed Easing Bets Mean for Your Investments and Business Opportunities
LONDON: Global stock markets advanced on Thursday, driven by strong tech sector gains on Wall Street, positive corporate earnings, rising hopes for a ceasefire in Ukraine, and anticipation of US interest rate cuts. Notably, Japanese shares reached record highs during the session.
Investor sentiment remained resilient despite President Donald Trump’s recent tariff measures, which included a 25% tariff on imports from India due to its purchases of Russian oil, and a threatened 100% duty on semiconductors. Eddie Kennedy, head of bespoke discretionary fund management at Marlborough, remarked, “It’s surprising that everything that gets thrown at the market… it just continues to melt-up.”
In Europe, the STOXX 600 index rose by 0.5%, with Germany’s DAX climbing 1% and France’s CAC 40 up 0.8%. Conversely, London’s FTSE 100 declined by 0.3%. The prospect of a meeting between President Trump and Russian President Vladimir Putin to discuss the Ukraine conflict provided further support to European equities and strengthened the euro. Emmanuel Cau, Barclays’ head of European equity strategy, noted, “A ceasefire would be an extra positive. It’s not the key driver, but it’s definitely been a lingering issue for Europe.”
Asian markets also saw gains: Japan’s Topix index closed at a record high, rising 0.7%, while the Nikkei increased by about 0.7%. Taiwan’s benchmark index surged as much as 2.6%, bolstered by a 4.9% jump in shares of TSMC. South Korea’s KOSPI added 0.6% following government announcements that Samsung and SK Hynix will be exempt from the proposed 100% semiconductor tariffs. Hong Kong’s Hang Seng rose 0.5%, and China’s CSI300 showed slight gains. Meanwhile, the offshore yuan strengthened to 7.1819 per dollar.
In the US, S&P 500 futures rose 0.3% after the index closed 0.7% higher on Wednesday. Capital.com analyst Kyle Rodda commented, “Wall Street seems to have gotten its mojo back, but there are persistent downside risks… valuations are stretched and trade uncertainty remains.” The US dollar weakened against major currencies amid growing expectations of a dovish Federal Reserve, influenced by recent soft economic data, upcoming jobs reports, and President Trump’s efforts to nominate Fed board members aligned with his policies.
US Treasury yields were relatively stable, with the 10-year yield steady at 4.2365%, and the two-year yield slightly rising to 3.7134%, near a three-month low of 3.659%.
The dollar index dropped 0.2% to 98.031, extending a decline from the previous day. The euro appreciated 0.2% to $1.1686, while the British pound gained 0.2% to $1.3378.
In commodities, spot gold increased by 0.3%, reaching $1,376 an ounce.
— Reuters
Special Analysis by Omanet | Navigate Oman’s Market
The global equity rally, fueled by tech gains, easing geopolitical tensions, and expectations of US interest rate cuts, signals heightened investor confidence and market resilience despite ongoing trade uncertainties. For Omani businesses, this environment offers opportunities to attract foreign investment and expand in tech-driven sectors, while smart investors should be mindful of valuation risks and the impact of global trade policies on supply chains. Entrepreneurs and policymakers in Oman should leverage this momentum by fostering innovation and diversification to capitalize on positive global market trends while mitigating external vulnerabilities.
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