(Bloomberg) — Stocks advanced in Europe along with U.S. equity futures after manufacturing data from the euro area pointed to further signs of a recovery from the virus slump. Treasuries were steady and the dollar declined.
Carmakers and banks led a broad advance in the Stoxx Europe 600 index as Purchasing Managers’ Indexes showed manufacturing in France unexpectedly returned to growth in May, while gauges for Germany and the single-currency region beat economists’ expectations. The euro strengthened and yields ticked higher on core European bonds.
Futures on the S&P 500 rose after fluctuating earlier in the wake of White House trade adviser Peter Navarro being quoted saying the China trade agreement was over. Crude oil slid along with the offshore yuan, while the Japanese yen and Treasuries gained, before all the moves began reversing when Navarro said the remark was taken “wildly” out of context. Trump later tweeted that the deal was “fully intact.” Shares rose across Asia.
While the economic reports fueled a risk-on mood already underway, they also summed up the situation for businesses across the region, which are reopening after coronavirus restrictions, but face weak demand and a far-from-normal situation. Even with a sharp rebound now, there’s huge uncertainty about the longer-term implications of the virus.
Still, some influential investors added to the positive sentiment. Steve Schwarzman, chief executive officer of Blackstone Group Inc., said the economy is likely to benefit from a V-type recovery in the next few months, though getting back to 2019 level will take “quite a while.” Hedge fund manager Bill Ackman said he sees gradual improvement on all fronts with so many resources poured into the health-care crisis.
Elsewhere, emerging-market stocks rallied, while high-yielding currencies including Mexico’s peso and South Africa’s rand strengthened against the dollar.
Here are some key events coming up:
MSCI Inc. on Tuesday announces its market classification review for 2020.The IMF will release new 2020 growth projections on Wednesday.U.S. jobless claims, durable goods and GDP data are due Thursday.A rebalance of Russell indexes is due on Friday.
These are the main moves in markets:
The Euro Stoxx 600 Index climbed 1.1% as off 10:28 a.m. in London.S&P 500 futures gained 0.6%, after having dropped as much as 1.6% earlier.MSCI Asia Pacific Index rose 0.7%.
The Bloomberg Dollar Spot Index dipped 0.2%.The Japanese yen fell 0.2% to 107.07 per dollar.The euro gained 0.2% to $1.1288.
The yield on 10-year Treasuries was flat at 0.71% after dropping as much as three basis points earlier.Germany’s 10-year yield dipped one basis point to -0.43%
West Texas Intermediate crude gained 1% to $41.13 a barrel.Gold gained 0.1% to $1,757 an ounce.
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