Global stock markets rose slightly yesterday, helped by better-than-expected Chinese factory activity data, and comments from US Federal Reserve Chair Janet Yellen suggesting the US central bank is in no rush to raise interest rates.
Following Wall Street's gains on Tuesday and more rises in Asia overnight, MSCI's 46-country world index was up 0.18 per cent at 433.63 points and veering closer to the 434.24 all-time peak it scaled in September.
The S&P 500 and Dow US indices rose slightly a day after they hit records. US stocks were bolstered by housing market data on Federal Reserve Chair Janet Yellen's second day of testimony.
In China, the closely watched flash HSBC/Markit Purchasing Managers' Index showed February factory activity hit a four-month high but export orders shrank at their fastest rate in 20 months.
Weakening global growth has kept investors on edge about the Fed's plans, with some worrying that a premature start to a rate-hike cycle could drain momentum from the US economy while Europe and China struggle.
Yellen's testimony Tuesday suggested the Fed would be flexible, which many strategists took as a sign that the Fed's first rate hike would not come until September. She repeated her remarks on Wednesday to a US House of Representatives committee. “What people are really hinging on is any noises that are coming out of the Fed, most notably Janet Yellen,” said Keith Bliss, senior vice-president at Cuttone & Co in New York.
“I would term what she did yesterday as somewhat 'jawbone therapy' where she knows the market is listening to every word and she is being just noncommittal enough.”
Brazil's Bovespa index was down 0.8 per cent. This was led by a 7 per cent drop in Petrobras, Brazil's largest company, after a credit was downgrade to 'junk' status due to a corruption probe and liquidity concerns.
The benchmark FTSEurofirst 300 index closed down 0.1 per cent after six days of unbroken gains. It has risen 12.7 per cent since the end of 2014.
US Treasuries prices edged lower. At 12.27pm, the Dow Jones industrial average rose 13.94 points, or 0.08 per cent, to 18,223.13, the S&P 500 gained 0.38 points, or 0.02 per cent, to 2,115.86 and the Nasdaq Composite added 3.77 points, or 0.08 per cent, to 4,971.89.
The dollar was down 0.25 per cent against a basket of currencies even after upbeat US housing data. Single-family home sales in January fell less than expected and supply rose to its highest level since 2010.
US crude oil was up 1.44 per cent at $49.98 a barrel after Saudi Arabia's oil minister said oil demand was growing. Brent Crude was up 2.2 per cent at $59.92.
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