Business World

Wednesday 23 May 2018

Mixed closes around Europe but fear fades from Wall Street

Traders work on the floor of the New York Stock Exchange shortly after the opening bell
Traders work on the floor of the New York Stock Exchange shortly after the opening bell

Reuters

The US dollar eased yesterday while an index of world stock markets gained and was poised for its best week since early March, as moderate inflation eased worries over a faster pace of US interest rate hikes and boosted risk appetite.

US stocks gained as healthcare stocks led a rally ahead of a speech by US President Donald Trump on drug pricing.

They were also propelled by results, with corporate earnings growth for the first quarter estimated at 26pc, according to Thomson Reuters Proprietary Research.

The advance was a delayed reaction to exceptionally strong earnings growth and benign inflation, said Leo Grohowski, chief investment officer at BNY Mellon Wealth Management in New York.

The Cboe Volatility Index, a barometer of expected near-term volatility for the S&P 500 that often is referred to as Wall Street’s fear gauge, has fallen to levels seen before the February market correction, Grohowski said. “Not only has the market returned handsomely, but risk has also taken a breather,” he said.

European shares edged higher, with the pan-regional STOXX 600 index of companies in 17 countries, rising 0.11pc for a seventh straight week of gains and the largest string of weekly advances since March 2015.

Meanwhile, the FTSE 100 ended the week in positive territory as analysts signalled London’s top flight could soon hit new highs if it continues its upward trajectory.

The blue chip index closed 0.31pc, or 23.58 points, up at 7,724.55.

In Europe, the French CAC ended down 0.07pc and the DAX fell 0.17pc. At home, the Iseq Index closed down 29.800 points at 6,961.59.

Online Editors

Business Newsletter

Read the leading stories from the world of Business.

Also in Business