As fears of an escalation in the Middle East subside, investors are shifting away from safe-haven assets, resulting in a boost to global equities. The MSCI global stock index (EURONEXT:IACWI) saw an increase of 6.01 points or 0.81%, reaching 749.29. Wall Street mirrored this positive sentiment, with the Dow Jones Industrial Average (DJI) climbing by 253.58 points or 0.67% to 38,239.98, the S&P 500 (SPX) advancing 43.37 points or 0.87% to 5,010.60, and the Nasdaq Composite (IXIC) rising by 169.30 points or 1.11% to 15,451.31.
Gold, Bonds Prices Under Pressure
Conversely, spot gold fell sharply by 2.59% to $2,328.65 an ounce, marking its most considerable one-day drop since June 2022. U.S. gold futures also saw a decrease of 2.8%, settling at $2,346.4. In the bond market, yields, which move inversely to prices, were generally trending towards multi-month highs. The U.S. 10-year Treasury note yield slightly decreased by 0.2 basis points to 4.613%, whereas the 30-year bond yield edged up by 0.6 basis points to 4.7168%.
Earnings Season and Market Sentiment
With over 150 companies from the S&P 500 and 173 companies from the STOXX 600 scheduled to report first-quarter results, investor focus is sharply on earnings. Notably, eyes are on major U.S. tech giants like Microsoft and Alphabet, especially following Nvidia’s 10% plunge on Friday.
In commodities, the FTSE-100 in London, heavy with resource stocks, rose 1.62% nearing record highs as tin and nickel prices reached multi-month peaks. Additionally, Portuguese stocks surged over 3% led by oil company Galp Energia, which soared about 20% after optimistic reports about a significant oil field off Namibia.
Shifts in Currency and Oil Markets
The dollar index slightly gained by 0.03% at 106.13, reflecting a steady position amid global uncertainties. In the oil sector, both Brent and West Texas Intermediate crude saw modest declines, each dropping by 29 cents to $87.00 and $82.85 a barrel, respectively, as market focus returned to fundamental supply and demand dynamics.
Interest rate expectations are also affecting market movements, particularly in the U.S., where traders are speculating about potential rate cuts by the Federal Reserve, possibly as early as July, with a more likely scenario in September. This anticipation is echoed in the movements of the two-year Treasury note yield, which rose slightly by 0.2 basis points to 4.9713%.
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