Global stocksii index soared on Friday, April 27, boosted by strong share price gains for tech giants such as Amazon and Facebook and growing hopes of a lasting peace on the Korean peninsula after a groundbreaking meeting of North and South Korean leaders.
European shares were set to end the week with a flourish too with a pan-European index set to post its fifth week of gains in a row, rivaling last September’s winning streak, with the tech sector strongly outperforming.
The latest gains are being partly spurred by forecast-beating first quarter earnings from two of the so-called FANG tech stocks — some of the world’s largest and most influential companies by market capitalization — which has boosted sentiment on the technology sector worldwide.
“Macro-economic data has been soft in a number of key economies, so it is reassuring that amidst those concerns we are still seeing strong earnings numbers coming through from big ticket corporates such as Amazon and Facebook,” said Investec economist Victoria Clarke.
“This is a good gauge of the broad drivers of sentiment particularly when there are those concerns about demand holding up in the face of weak economic data,” Clarke added.
European tech shares rose 0.75 percent to the highest in more than five weeks, buoyed also by gains in local IT and chipmaking firms such as Capgemini, ASML and Infineon.
South Korean President Moon Jae-in and North Korean leader Kim Jong Un walk together at the truce village of Panmunjom inside the demilitarized zone separating the two Koreas, South Korea, April 27, 2018. Korea Summit Press Pool/Pool via Reuters
Earlier, though, Asian markets reveled in the glow of the summit between North Korea’s Kim Jong Un and South Korean president Moon Jae-in. Political leaders and investors hope this would ease tensions over Pyongyang’s nuclear weapons program and pave the way for the North and South to end their decades-long conflict.
That helped Seoul shares briefly rise more than 1 percent to a one-month high and the won firmed. MSCI’s index of Asian shares outside Japan rallied 0.8 percent and Japan’s Nikkei share average rose 0.7 percent to two-month peaks.iii
With a weekly gain of more than 1.5 percent, the greenback is set for its best weekly performance since late-November 2016.