WSJ: Global Stocks Stabilize After U.S. Data, Commodities Rally
Asian stocks rose and European shares slipped after a rally on Wall Street spurred optimism about the U.S. economy and a sharp rebound in commodity prices.
The Stoxx Europe 600 fell 0.6% in early trading after Thursday’s 3.5% rally. In Asia, the Shanghai Composite Index ended the session 4.8% higher, adding to its 5.3% jump Thursday, which was its biggest percentage gain in more than a month.
Futures indicated an opening fall of 0.8% for the S&P 500. Changes in futures, however, don’t necessarily accurately reflect moves after the opening bell.
Friday’s moves follow a turbulent week for global markets during which stocks and commodities were pummeled by fears of a slowdown in China’s economy before staging a dramatic recovery.
Following a strong reading of U.S. gross domestic product Thursday—which expanded 3.7%in the second quarter, up from an initial estimate of 2.3% growth—oil prices soared more than 10% to their biggest percentage gain in years.
On Friday, Brent crude was up 0.8% at $47.94 a barrel.
Although extreme market swings have abated, Barclays economists wrote in a note to clients that we haven’t yet reached “the end of the storm.”
“Concerns about China’s economy continue to act as a major weight on [emerging market] sentiment,” they wrote, adding that any rebound in those assets may be difficult to sustain.
Later in the session, investors will focus their attention on a conference of central bankers from around the world in Jackson Hole, Wyo., that is set to last into the weekend.
U.S. Federal Reserve Chairwoman Janet Yellen isn’t scheduled to attend, but investors will be listening closely to other policy makers for hints of when the Fed might start raising interest rates.
The recent market turmoil has prompted many investors and strategists to push back their expectations of an increase.
In Europe, Germany is scheduled to publish provisional inflation figures later Friday, while the European Commission will release its latest economic sentiment indicator.
In currency markets, the euro rose 0.4% against the buck to $1.1287 and the dollar was steady against Japan’s yen at ¥121.13.
