(Bloomberg) — Stocks traded mixed over the weekend as U.S. and European indexes hit record highs amid optimism about central bank monetary easing and economic stimulus from China. Following Japan’s election results, the yen started to rise.
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Europe’s Stoxx 600 index edged up, posting its best weekly performance since mid-August as promises of economic support by the Chinese leader boosted luxury goods and mining stocks. U.S. futures fell after the S&P 500 index hit a record high for the 42nd time this year. The dollar and 10-year U.S. Treasury yields were trading flat.
Daily announcements on economic stimulus from China, combined with rising expectations for further interest rate cuts from the US Federal Reserve (Fed), have increased risk appetite across the market. Traders are keeping an eye on the Fed’s recommended inflation indicators and snapshots of consumer demand, and Thursday’s solid revised data could provide further clues on interest rates.
Japan’s yen rebounded against the dollar after Shigeru Ishiba won the ruling party leadership election. Ishiba is a party veteran who has held several key positions, including defense minister, and is seen as supporting the Bank of Japan’s plan to raise interest rates in stages. He defeated his opponent, Sanae Takaichi, who recently said, “It would be foolish to raise interest rates now.”
In China, the CSI300 index rose 4.5%, ending its best week since 2008. The People’s Bank of China has launched its boldest policy campaign in decades, with the Chinese government rolling out powerful stimulus measures to revive the economy. Economic slowdown and investor confidence.
Stock trading volume reached 710 billion yuan ($101 billion) in the first hour of trading on Friday, and the Shanghai Stock Exchange was hit by glitches and delays in order processing, according to a message from a brokerage obtained by Bloomberg News. received. Copper rebounded above $10,000 per tonne, and iron ore topped $100 per tonne.
emergency response
Senior analysts including ING Group NV’s Robert Carnell said in a note that China’s leaders hope that holding the Politburo meeting in September instead of December will “give authorities more urgency to reach their 5% growth target.” “We have sent a signal that we are ready to take action,” he said. “This week, a more aggressive policy package was announced by the People’s Bank of China than expected, and it’s reasonable to expect other policies to follow soon.”
Elsewhere in commodities, oil prices were firm after two days of sharp declines, with prices still on track for a sharp weekly decline on the prospect of increased supply from OPEC members Saudi Arabia and Libya.
Gold headed for its third weekly gain after hitting consecutive record highs on optimism that the Federal Reserve will maintain its aggressive pace of rate cuts this year.
This week’s main events:
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Eurozone consumer confidence, Friday
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US PCE, University of Michigan Consumer Psychology, Friday
The main movements in the market are:
–With assistance from Winnie Hsu.
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