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Global equities extended their gains on Friday, capping the week in which investors looked at international trade tensions and stressed that strengthening the US economy could preserve the recovery.
Taking the top spot on Wall Street on Thursday, China's stock markets in Germany were poised to experience significant weekly gains. The Stoxx Europe 600 gained 0.7% in the early morning, driven by gains in the automotive and resource sectors. Asian markets have recovered at all levels.
In the United States, futures have indicated a 0.2% opening gain for the S & P 500 and a 0.3% rise for the Dow Jones Industrial Average after both indexes hit new highs at the previous session. It was the 19th record of the S & P 500 this year.
The gains came as investors this week mostly ignored the imposition of new tariffs in the trade dispute between the United States and China. Market participants focused on the strong fundamentals, including strong corporate performance and a strong US economy, which has been growing fastest since 2014.
"The risk is having a good time," said Jim Reid, an analyst at Deutsche Bank, in a note to his clients.
Highlighting strong economic prospects, data from the Labor Department showed Thursday that initial jobless claims, an indicator of layoffs in the United States, have fallen to the lowest level since 1969.
"The overall picture is clear: the US economy is doing very well," said Eric Stein, co-director of global revenues at Eaton Vance, based in Boston. "At some point, you start to wonder if this is as good as you can. But we are not there yet.
The S & P 500 and the Dow Jones Industrial Average both set new highs in Thursday's session.
Photo:
Bryan r. smith / Agence France-Presse / Getty Images
Investors were also waiting for the meeting of the Federal Reserve next week. Most observers expect the US central bank to raise interest rates.
"The economy is doing well and inflation is not firming, it's easy for the Fed this year," said Stein, who expects a rate hike next week and another in December. "In a year, it's more interesting."
The 10-year US Treasury yield edged down to 3.072% from 3.076% on Thursday. Yields evolve in the opposite of prices.
The WSJ Dollar Index, which tracks the dollar against a basket of 16 currencies, rose 0.1%.
In Asia, Chinese equities led the way, with Shanghai Composite closing 2.5% higher, its biggest gain in six weeks. Japan's Nikkei Stock Average rose 0.8% while Hong Kong's Hang Seng rose 1.6%.
In the commodities sector, Brent crude, the world benchmark for oil prices, rose 0.2% while gold rose 0.1%.
Write to Georgi Kantchev at [email protected]
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