DUBAI, LONDON
World stocks hit record highs on Thursday and the dollar dipped after the US Federal Reserve signalled caution in raising interest rates. US stocks rose to fresh records as retailer results boosted confidence in the American consumers’ ability to jump-start economic growth.
The S&P 500 Index pushed its longest rally since February to six days as Best Buy Co. and PVH Corp. results topped estimates and the Bloomberg Consumer Comfort Index signalled optimism among US shoppers. The dollar steadied in the wake of the Fed minutes, which cast some doubt over the trajectory of interest rate increases but confirmed the likelihood of a June hike.
The latest earnings reports bolstered a retail group that’s been hit by struggles at mall-based stores and signs that wages haven’t been rising fast enough to spark a meaningful surge in spending. They added to risk appetite after Fed policymakers indicated recent weakness in growth is transitory. The bullish sentiment was limited among stock investors in Europe, where some markets were closed today for the Ascension holiday.
Yields dip
US Treasury yields dipped after the minutes, weakening the dollar. The benchmark 10-year yield was down 1.6 basis point on Thursday at 2.25 per cent.
Eurozone borrowing costs also fell after what was seen as a sign central banks would be wary of stepping back too quickly from ultra-loose policies that have supported their economies.
Earlier, Asian stocks, as measured by MSCI gained almost 1 per cent to a two-year high. This helped push MSCI’s 46-country world stock index to a record high of 464.38. It last stood at 463.78, up 0.2 per cent.
In the currency markets, the euro edged down 0.1 per cent to $1.1207, pulling further away from Tuesday’s 6 1/2-month of $1.1268.
