Chinese Stimulus Plan, Strong Earnings Send Stocks Higher 24 July 2018

Stock markets rallied Tuesday, helped by Chinese stimulus plans and strong earnings by Google's parent company sending the Nasdaq to a record high.

London, (UrduPoint / Pakistan Point News - 24th Jul, 2018 ) :Stock markets rallied Tuesday, helped by Chinese stimulus plans and strong earnings by Google's parent company sending the Nasdaq to a record high.

In Europe, London's benchmark FTSE 100 index closed 0.7 percent higher, with Frankfurt's DAX 30 climbing 1.1 percent and the Paris CAC 40 up 1.0 percent.

Wall Street moved higher, with the tech-heavy Nasdaq setting a new record on the back of strong results posted by Google's parent company Alphabet.

The Dollar traded mixed, while bitcoin went back above $8,000 to reach the highest level since May.

"Stock markets are enjoying a decent move higher... receiving a dual boost in sentiment from a proposed Chinese fiscal stimulus and a better than expected set of results from Google-parent company Alphabet," said David Cheetham, chief market analyst at traders XTB.

While Alphabet suffered a dip in second-quarter profits due to a fine from the European Union, it posted a bigger-than-expected 26 percent jump in revenues to $32.7 billion in an earnings report released after Wall Street closed on Monday.

Its shares were up 4.0 percent in late morning trading.

"With Alphabet, Facebook, and microsoft leading the way, tech has once again proven a reliable sector for investors, as the Nasdaq hit record highs in early trade," said IG market analyst Joshua Mahony.

"With earnings season upon us, there is a growing feeling that markets will be able to focus on a positive corporate trajectory rather than the persistent fears over the potential damage of global trade arising from further tariffs," he added.

- 'Tariffs are the greatest!' - However, tensions persist over a global trade war.

With European Commission President Jean-Claude Juncker heading to Washington on Wednesday to meet US President Donald Trump and try to avert an escalation of tit-for-tat tariffs, the US leader tweeted: "Tariffs are the greatest!" In a separate tweet he claimed that "countries that have treated us unfairly on trade for years are all coming to Washington to negotiate." The US leader is already embroiled in a messy trade dispute with China and Europe, while negotiations with Canada and Mexico to revamp the North American Free Trade Agreement have stalled.

In a bid aimed at shielding China's economy -- the world's second-largest -- from a worsening trade row with Washington, Beijing on Tuesday signalled it would shift to a looser fiscal policy.

Shanghai's main stocks index jumped 1.6 percent in response, while the Yuan hit a 13-month low versus the dollar.

"Mining companies like BHP Billiton, Rio Tinto, and Glencore are higher on the back of the planned stimulus package from China," said David Madden, analyst at CMC Markets UK.

"The second-largest economy in the world is a major importer of minerals, and traders are snapping up commodity companies as they feel that China's appetite for metals will rise." BHP Billiton closed 5.7 percent higher, with Glencore gaining 5.6 percent and Rio Tino rising 4.8 percent.

In Europe meanwhile, shares in French car giant PSA surged 14.9 percent after the owner of Peugeot drove profits higher thanks in part to a major turnaround for its Opel Vauxhall brand.

Elsewhere Tuesday, China's state-owned China Tower -- the world's largest operator of telecommunications towers announced it would aim for an $8.7-billion initial public offering in Hong Kong, the biggest globally in four years.

- Key figures at 1530 GMT - New York - Dow: UP 0.8 percent at 25,240.56 points London - FTSE 100: UP 0.7 percent at 7,709.05 (close) Frankfurt - DAX 30: UP 1.1 percent at 12,689.39 (close) Paris - CAC 40: UP 1.0 percent at 5,434.19 (close) EURO STOXX 50: UP 1.0 percent at 3,487.28 Tokyo - Nikkei 225: UP 0.5 percent at 22,510.48 (close) Hong Kong - Hang Seng: UP 1.4 percent at 28,662.57 (close) Shanghai - Composite: UP 1.6 percent at 2,905.56 (close) Euro/dollar: UNCHANGED at $1.1694 Pound/dollar: UP at $1.3141 from $1.3102 at 2100 GMT Dollar/yen: DOWN at 111.22 Yen from 111.35 yenOil - Brent Crude: UP 65 cents at $73.71 per barrelOil - West Texas Intermediate: UP 99 cents at $68.88 per barrel