Global shares and U.S. Treasury yields rose on Friday following stronger-than-expected job growth data that raised investor expectations that the Federal Reserve could retain its interest rate hikes. Labor Department data showed on Friday that the U.S. economy added 339,000 jobs last month, significantly higher than most estimates and suggesting tighter labor market conditions which might prompt a Fed rate hike. The market mood was also supported by the U.S. Senate passing bipartisan legislation on Thursday that lifted the federal government’s $31.4 trillion debt ceiling and averted what would have ...

US: All eyes on May core inflation Market expectations for whether the Federal Reserve will hike interest rates again have swung wildly over recent weeks. Currently, the favoured narrative is that the Fed has raised interest rates significantly and tighter lending conditions will act as a brake so it may be best to hold rates unchanged at the June FOMC and re-evaluate the situation in July. If the jobs market is still hot and inflation continues to track well above target, they can then hike again. Nonetheless, there are hawks ...

The hefty weight of tech megacaps, strange reporting rules for an upcoming OPEC meeting and more pain for consumers and businesses Down Under – these are just some of the topics preoccupying markets as they approach the halfway point of 2023. Here’s a look at the week ahead in markets from Kevin Buckland in Tokyo; Ira Iosebashvili in New York and Dhara Ranasinghe, Karin Strohecker and Amanda Cooper in London. 1/THE NARROWEST RALLY THIS CENTURY Some investors are growing concerned about how gains in the S&P 500 have become increasingly ...

U.S. stocks closed higher on Friday after a labor market report showing moderating wage growth in May indicated the Federal Reserve may skip a rate hike in two weeks, while investors welcomed a Washington deal that avoided a catastrophic debt default. The tech-heavy Nasdaq index surged to a 13-month intraday high and posted its sixth-straight week of gains that marked its best winning streak since January 2020. U.S. job growth accelerated in May but a surge in the unemployment rate to a seven-month high of 3.7% as more people looking ...

As the U.S. stock market continues its climb, investors holding shares of the massive tech and growth companies leading the charge are debating whether to cash out or stay on for the ride. A record $8.5 billion flowed into tech stocks in the latest week, data from BofA Global Research showed, as investors piled into a rally that has seen the tech-heavy Nasdaq 100 gain 33% in 2023. The benchmark S&P 500 has risen 11.5% this year and stands at a 10-month high. Yet others see reasons for caution. Among ...

Investors who earned easy money with high-risk bonds invented after the financial crisis are being forced to accept that the rules have changed: they may not get paid. Banks typically sold these perpetual bonds – known as AT1 bonds – with five years before an option to repay was triggered. In the past, investors got their money back, and banks replaced the bonds with new ones, but some are changing tack. The trend highlights the vulnerability of global finance as it grapples with rocketing borrowing costs and the impact of ...

Germany is leading the biggest rally in global bond markets since March’s banking rout as cooling inflation and a weakening economy suggest European Central Bank rate hikes are nearing an end. Borrowing costs, or bond yields, in the benchmark euro area issuer are down at least 20 basis points (bps) this week. Alongside British and U.S. peers, yields – which move inversely to bond prices – were set for their biggest weekly declines since mid-March when banking turmoil sparked a dash to safe-havens. Certainly, government bonds remain hostage to data ...

Shares in some Chinese temple operators and lottery sellers surged for a second day on Thursday amid a weak post-COVID recovery, as despondent young people rush to pray or gamble amid greater economic uncertainty. Data showed Chinese temple visits more than quadrupled this year compared with 2022, while sales of lottery tickets jumped in April to their highest in a decade. In stark contrast, the youth unemployment rate hit a record 20.4% in April, and multiple indicators showed economic recovery is losing steam following an initial bounce after China lifted ...

Global stocks and commodities rose on Friday while the dollar headed for its biggest weekly drop since January, as sentiment was buoyed by signs the Fed will skip a rate hike at its next meeting and the approval of U.S. debt ceiling legislation. Markets are now focused on U.S. jobs data due 0830 EST (1230 GMT), the most significant macro economic release of the week, for more cues on the Federal Reserve’s rate hike path. The U.S. Labor Department’s employment report is likely to show nonfarm payrolls increased by 190,000 ...

Persistent inflation could prompt RBA to hike again The June Reserve Bank of Australia (RBA) meeting is a tough one to call. The RBA recently confused markets with its reversion to a more hawkish stance, even as inflation was weakening, and now the fall in inflation has reversed, there is a reasonable argument for it to hike again this month. However, the quarterly CPI data still seem to carry more weight than the monthly series at the moment, so some forecasters expect the RBA to wait until the August meeting ...

Foreign investors’ selling of Chinese shares gained some momentum in May, as flagging domestic demand and expectations for weak corporate earnings led to steep falls on mainland and Hong Kong stock markets. Refinitiv data shows foreigners sold $1.71 billion worth of mainland shares this month via Stock Connect, a key cross-border link between the mainland and Hong Kong exchanges, after selling $659 million in April. The selling marks a slow reversal of their heavy investment totaling $20.92 billion in January when China reopened its economy after three years of COVID ...

A bill backed by debt justice campaigners and civil society groups advocating on behalf of economically distressed countries could alter past and future sovereign debt restructurings covered by New York state law – and Wall Street is watching. These are some key points about the bill. WHAT DOES THE BILL PROPOSE? Senate Bill S4747, the NY Taxpayer and International Debt Crises Protection Act, “relates to New York state’s support of international debt relief initiatives for certain developing countries.” The bill includes limits to state investments into foreign entities and would ...

Global shares rose on Thursday amid receding bets for a U.S. rate hike this month and relief over the passage through the U.S. House of Representatives of a bill to suspend the federal debt ceiling. A divided House passed a bill to suspend the $31.4 trillion debt ceiling – and avert a catastrophic default – with majority support from both Democrats and Republicans, stoking optimism that it can move through the Senate before the weekend. The Euro STOXX 600 index rose 0.8% after closing at a two-month low in the ...

“We’ve been saying since the end of 2022 that rate cuts this year would be unlikely as inflation sticks around. Markets are waking up to our view as a look under the hood reveals signs of weaker growth in major economies and market weakness due to rate hikes.” This is one of the main conclusions of BlackRock’s (NYSE:BLK) latest weekly market report. “Debt ceiling talks and the U.S. Treasury potentially being unable to pay its bills by early June have added to recent market volatility,” they add. “We like quality ...

Investors have poured $756 billion into cash funds this year, Bank of America said in a note on Friday, attracted by juicy yields and driven by concerns about banks. The rush into money market funds continued in the week to Wednesday, with $23.1 billion flowing into the cash-like instruments, according to BofA, which cited figures from financial data company EPFR. Rising interest rates have pushed up the yields available on money market funds, which are mutual funds that invest in highly liquid short-term debt, such as that issued by governments. ...