London (AFP) – Stocks mostly rose and the dollar retreated Wednesday on hopes for further US interest rate cuts and a solid set of company earnings. Gold surged to a fresh high above $4,200 an ounce, boosted also by a fresh flare-up in China-US tensions. The dollar was weighed by warnings from Federal Reserve boss Jerome Powell on risks to the US labour market, reinforcing expectations the central bank will cut rates at its October meeting. A series of weak jobs reports led the Fed to trim borrowing costs last month for the first time in 2025.
“The Fed and a raft of better-than-expected earnings reports are driving sentiment,” said Kathleen Brooks, research director at trading group XTB. Paris surged more than two percent, after the world’s biggest luxury group LVMH beat earnings expectations, triggering a rally across the sector. LVMH soared 14 percent, while Gucci-owner Kering and Hermes both rose more than six percent in Paris. Burberry jumped six percent in London.
“Luxury goods demand has been in something of a tailspin of late, but LVMH…has reported signs of easing pressures,” said Steve Clayton, head of equity funds at Hargreaves Lansdown. Investors also hoped for an end to France’s political turmoil after Prime Minister Sebastien Lecornu backed the suspension of an unpopular 2023 pensions reform to bolster his cabinet’s survival.
Frankfurt was on the front foot nearing the halfway mark, but London slipped. Sentiment was lifted by Dutch tech giant ASML reporting solid sales and orders on its semiconductor machines. Its shares rose more than three percent in Amsterdam, even as it warned on a steep fall in its China business next year.
After US markets closed mostly down Tuesday, Asian markets rallied. Seoul soared 2.7 percent, while Hong Kong, Shanghai, and Tokyo all closed more than one percent higher. The gains came despite data showing Chinese consumer prices fell in September, in a sign that the world’s second-largest economy still faces weak consumer activity. Investors remained cautious over the latest trade salvos between Washington and Beijing, with Trump last week threatening 100-percent tariffs owing to China’s new export controls on rare earths.
China appeared to stoke the row Tuesday by imposing sanctions on five American subsidiaries of South Korean shipbuilder Hanwha Ocean, accusing them of supporting Washington’s investigation into the shipping industry. Still, there are hopes the row can be defused, with US Trade Representative Jamieson Greer expressing cautious optimism.
– Key figures at around 1045 GMT –
London – FTSE 100: DOWN 0.6 percent at 9,398.40 points
Paris – CAC 40: UP 2.4 percent at 8,107.26
Frankfurt – DAX: UP 0.1 percent at 24,269.14
Tokyo – Nikkei 225: UP 1.8 percent at 47,472.67 (close)
Hong Kong – Hang Seng Index: UP 1.8 percent at 25,910.60 (close)
Shanghai – Composite: UP 1.2 percent at 3,912.21 (close)
New York – Dow: UP 0.4 percent at 46,270.46 (close)
Euro/dollar: UP $1.1623 from $1.1604 on Tuesday
Pound/dollar: UP at $1.3354 from $1.3319
Dollar/yen: DOWN at 151.40 yen from 151.74 yen
Euro/pound: DOWN at 87.04 pence from 87.13 pence
Brent North Sea Crude: DOWN 0.2 percent at $62.29 per barrel
West Texas Intermediate: FLAT at $58.69 per barrel
© 2024 AFP
