Investors shift their focus to central banks’ reaction to faster-than-expected recovery from Covid-19 pandemicLondon — Stock markets hovered near record highs on Wednesday as investors cheered the latest evidence of a sustained rebound in global economies and stronger oil prices lifted energy stocks.
The broad Euro Stoxx gained 0.22%, slightly below Tuesday’s record high. UK shares extended their rally, with the FTSE 100 up 0.36%, while Germany's DAX and the French CAC 40 gained marginally. Mark Haefele, chief investment officer at UBS, Global Wealth Management, said vaccination rollouts would spur “a return to normal patterns of mobility, supporting energy demand”, while support for prices also came from an Opec agreement to increase production gradually.
Economies are recovering much faster than anticipated — data on Wednesday shows Australia's economy racing ahead last quarter as consumers and businesses spent with abandon, lifting output back above pre-pandemic levels. While investors have built sizeable short positions against the US dollar, some investors are concerned about a surprise hawkish tone from the Federal Reserve at its meeting later in June.German 10-year Bund yields slipped 1 basis point to 0.187% lower, but have largely shrugged off HICP data on Tuesday showing eurozone inflation rose to 2% in May — a sign that markets are confident the European Central Bank will not decide to slow the pace of its bond purchases when it meets on June 10.