Global stocks edged higher Monday, June 11, ahead of what promises to be an extraordinary week for risk events around the world.
This is coming on the heels of a trio of major central bank rate decisions, a key court case that could unlock billions in media sector mergers and a nuclear summit in Singapore that could mark a major advance towards peace on the Korean peninsula.
Worldwide reaction to the collapse of this weekend’s G-7 Summit in Quebec City, however, suggests investors may not focus as much on the geopolitical and trade tensions that have dogged markets for the past few weeks as fundamentals remain robust in most of the major economies and corporate earnings and merger activity continues to impress.
Nonetheless, European stocks opened firmly higher Monday, with the banking sector leading the charge, as deeper bets on a change in policy from the European Central Bank this Thursday boost both the single currency and regional government bond yields.
The Stoxx Europe 600 index, the region’s broadest measure of share prices, gained 0.48% in the opening minutes of trading, while Italy’s FTSE MIB benchmark surged 2.03% as investors piled back into Europe’s third-largest economy following a weekend interview with Finance Minister Giovanni Tria that categorically rejected the idea of any plans to leave the single currency.
Germany’s DAX performance index gained 0.54% to start the week even as shares in benchmark heavyweight Daimler AG (DMLRY) fell 1.4% following a weekend report from the Bild am Sonntag newspaper that alleged Germany’s road regulator, the KBA, found so-called ‘defeat devices’ in the company’s Euro 6 diesel fleet.
Early indications from U.S. equity futures suggest a mixed start to trading on Wall Street this week, ahead of the Federal Reserve’s two-day meeting on interest rates that starts tomorrow, with contracts tied to the Dow Jones Industrial Average pointing to an 54.4 point gain for the 30-stock index while those tied to the S&P 500 indicate
