Robust tech sector gains in Asia helped drive world stocks near one-week highs on Tuesday, May 8.
MSCI’s global tech index closed Monday at six-week highs. That helped lift emerging Asian shares by 0.5 percent and Japanese equities by 0.2 percent.
Wall Street was lifted on Monday by a strong rally in Apple shares to new record highs following forecast-beating results last week and billionaire Warren Buffett’s decision to increase his stake in the firm.
Nearly 80 percent of the S&P 500 companies which have reported first quarter earnings have topped profit estimates, according to Thomson Reuters.
Momentum fizzled in Europe, however, with a pan-European equity benchmark and European tech down 0.2 percent. Futures for S&P500, Dow Jones and Nasdaq also slipped about 0.2 percent, signaling Wall Street weakness.
Italian shares were the day’s worst performers, slipping 1.5 percent as chances grew of new elections following an inconclusive March 4 vote. Italian 10-year bond yields rose almost nine basis points to end-March highs.
“It’s not a good day for Italian assets. Markets are starting to feel the pressure of elections,” said Carlo Franchini, head of institutional clients at Italy’s Banca Ifigest. Italy’s fragile economic recovery was at risk, he added.
Countering this was good news from China, where April exports and imports beat forecasts. Trade tensions between China and the United States also seem to have abated slightly, with talks resuming next week.
Expectations of further rises in U.S. interest rates are forcing investors to buy back dollars they sold earlier this year on worries about Trump’s protectionist policies.
“For the foreseeable future attractive interest rates at favorable risk conditions will only be on offer in the United States,” Commerzbank said, referring to the fading likelihood of near-term policy tightening in Europe and Japan, Reuters reports.
