Dow Hits New High As Brightening Outlook Cheers Markets

Global equities rebounded Wednesday as investors focused on bright earnings and data pointing to an economic recovery, lifting Wall Street to a new record high

London, (UrduPoint / Pakistan Point News - 5th May, 2021 ) :Global equities rebounded Wednesday as investors focused on bright earnings and data pointing to an economic recovery, lifting Wall Street to a new record high.

London rose 1.7 percent on the session, led by miners, for its highest close since the Covid-19 pandemic first hit Europe just over 14 months ago.

Frankfurt rose 2.1 percent and Paris added 1.4 percent as a survey showed April had the fastest growth of eurozone companies in nine months, sparking hope that the bloc would exit a double-dip recession.

On Wall Street, the Dow began cautiously and slipped briefly into the red, but pushed back as data showed the US jobs market strengthened last month even if payrolls still stand around eight million jobs down on pre-pandemic levels.

Another PMI survey, from the Institute of Supply Management, also showed the US services sector as bouncing back strongly in April, further reason to propel the Dow to a record high of 34,293 just over two hours into trading, before falling slightly back.

Tuesday's tech-led sell-off, which knocked Asian markets back, came after US Treasury Secretary Janet Yellen suggested US interest rates might need to be increased to temper inflationary pressures.

Stocks rose after Yellen clarified her comments by stressing she was not predicting or calling for a tightening of rates as the US embarks on a massive stimulus programme.

"Having seen large falls yesterday, markets appear to have recovered some of their mojo rebounding strongly today," commented Michael Hewson of CMC Markets.

"European bourses are flying higher today, helped by strong earnings and accelerating business activity in the region," said OANDA analyst Sophie Griffiths before the US took up the bullish baton.

Oil prices meanwhile moved higher on hopes for a recovery in demand.

- Eurozone recession exit? - IHS Markit's eurozone composite Purchasing Managers' Index (PMI), a key gauge of business activity, rose to 53.8 points in April from 53.2 in March, above the crucial 50-point level that indicates growth.

The survey data "provide encouraging evidence that the eurozone will pull out of its double-dip recession in the second quarter," said IHS Markit chief business economist Chris Williamson.

"A manufacturing boom, fuelled by surging demand both in domestic and export markets as many economies emerge from lockdowns, is being accompanied by signs that the service sector has now also returned to growth." Official data last week showed that the eurozone economy fell into its second recession in less than a year in the first quarter, hit by slow vaccinations and pandemic lockdowns.

- Key figures around 1600 GMT - New York - Dow: UP 0.4 percent at 34,284.95 London - FTSE 100: UP 1.7 percent at 7,039.31 points (close) Frankfurt - DAX 30: UP 2.1 percent at 15,170.78 (close) Paris - CAC 40: UP 1.4 percent at 6,339.47 (close) EURO STOXX 50: UP 1.9 percent at 3,998.98 Hong Kong - Hang Seng Index: DOWN 0.5 percent at 28,417.98 (close) Tokyo - Nikkei 225: Closed for a holiday Shanghai - Composite: Closed for a holiday Euro/dollar: DOWN at $1.2002 from $1.2014 at 2100 GMT Pound/dollar: UP at $1.3913 from $1.3887 Euro/pound: DOWN at 86.26 pence from 86.51 pence Dollar/yen: DOWN at 109.28 Yen from 109.33 yenBrent North Sea crude: UP 0.9 percent at $69.49 per barrelWest Texas Intermediate: UP 0.7 percent at $66.17 per barrel