Stocks Rise on Fed Rate-Cut Bets, Earnings Boost: Markets Wrap

(Bloomberg) — Global stocks rose Thursday, lifted by data showing cooling US core inflation and a slew of robust corporate earnings. 

Europe’s Stoxx 600 climbed for a third day, with luxury goods maker Richemont soaring 18% after it reported a jump in jewelry sales. The report lifted an index of European luxury stocks the most since March 2022. Tech stocks also outperformed, with ASML Holding NV up as much as 4.9%, as a strong outlook from Taiwan Semiconductor Manufacturing Co. fueled hopes of resilient AI spending. 

Futures contracts for the Nasdaq 100 were up 0.3%, supported by the upbeat report from TSMC, the main chipmaker to Apple Inc. and Nvidia Corp. S&P 500 futures rose 0.2%, after the benchmark’s 1.8% rally on Wednesday, its best day since the November election. Tech shares, including Nvidia, rose in premarket trade.

The gains came after data showed US core inflation came in at 0.2%, marking the first step down in six months and reinvigorating some bets that the Federal Reserve will lower interest rates further this year. Ten-year Treasury yields, which slid 10 basis points after the data, held steady on Thursday. 

The latest figures from the US as well as Britain are “important to remind us that we shouldn’t be caught up in the flux of inflation concerns,” said Guy Miller, chief strategist at Zurich Insurance Co. “We have to expect market volatility, which will be a function of a new US administration coming in, but the economic fundamentals are still encouraging.”

Swap traders are back to fully pricing in a Fed rate reduction by July, reinstating bets that were dashed by stronger-than-expected December jobs data. But the renewed appetite for risk will be tested in coming days as the Fed and the Bank of Japan hand down policy decisions, and President-elect Donald Trump takes office. 

The US will publish initial jobless claims and retail sales data later in the day, providing investors with a broader picture of the health of the world’s largest economy. Earnings are also due from Bank of America Corp. and Morgan Stanley, following blockbuster results from top US banks including JPMorgan Chase & Co and Goldman Sachs. 

In currency markets, Bloomberg’s dollar index halted a two-day losing streak. The latest lackluster growth data from Britain underscored the divergence between the US economy and its peers in the developed world, knocking the pound lower against the greenback. The yen firmed, however, on a report that Bank of Japan officials see a good chance of a rate increase next week.

“The more favorable US economic outlook relative to other major economies continues to support the fundamental dollar uptrend,” Elias Haddad, a strategist at Brown Brothers Harriman, told clients. 

Key events this week:

• ECB releases account of December policy meeting, Thursday
• Bank of America, Morgan Stanley earnings, Thursday
• US initial jobless claims, retail sales, import prices, Thursday
• China GDP, property prices, retail sales, industrial production, Friday
• Eurozone CPI, Friday
• US housing starts, industrial production, Friday

Some of the main moves in markets:

Stocks

• The Stoxx Europe 600 rose 0.6% as of 9:37 a.m. London time
• S&P 500 futures rose 0.2%
• Nasdaq 100 futures rose 0.3%
• Futures on the Dow Jones Industrial Average were unchanged
• The MSCI Asia Pacific Index rose 0.9%
• The MSCI Emerging Markets Index rose 1.1%

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.0291
• The Japanese yen rose 0.4% to 155.78 per dollar
• The offshore yuan was little changed at 7.3495 per dollar
• The British pound fell 0.3% to $1.2200

Cryptocurrencies

• Bitcoin fell 0.7% to $99,020.57
• Ether fell 3.5% to $3,314.59

Bonds

• The yield on 10-year Treasuries advanced one basis point to 4.67%
• Germany’s 10-year yield advanced two basis points to 2.58%
• Britain’s 10-year yield was little changed at 4.73%

Commodities

• Brent crude fell 0.3% to $81.78 a barrel
• Spot gold rose 0.3% to $2,703.48 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Winnie Hsu and Chiranjivi Chakraborty.

©2025 Bloomberg L.P.