NEW YORK, Jan 24 ― Global equity markets surged yesterday as easing recession fears and hopes of a less aggressive Federal Reserve buoyed sentiment, while the likelihood of more jumbo interest rate hikes in Europe pushed the euro to a nine-month peak against the dollar.
The start of a big week for US corporate earnings is expected to test a recent bounce in tech and other growth stocks as companies discuss their outlook amid a slowing economy. “This is like other market rallies that we've seen within an ongoing bear market in that you have these periods of optimism seep in because people think that the story is changing enough that the problem is gone,” he said.
The pan-European STOXX 600 closed up 0.6 per cent, as declining natural gas prices eased recession fears. Investors are waiting for euro zone and US flash PMI data today, which are expected to show less severe economic contractions than the previous month, according to analysts polled by Reuters. The data is forecast to show more improvement in Europe than in the United States.
Sterling traded at US$1.2375, down 0.15 per cent, while the Australian dollar, seen as a proxy for risk appetite, rose 0.86 per cent to US$0.7026. The Japanese yen weakened 0.83 per cent at 130.67 per dollar.