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Global Shares Surge as U.S. Inflation Cools, Gold Above $2,000

Global shares experienced an increase on Thursday as U.S. inflation data hinted that the Federal Reserve might be concluding its interest rate hikes. This development kept gold prices above $2,000 per ounce, pushing the dollar to linger around two-month lows.

Federal Reserve
Federal Reserve

Euro and European Blue-Chip Stocks Reach Highs Amid Hawkish Outlook

The euro reached a 2-1/2 month high at $1.103 as investors showed optimism for Europe. Blue-chip stocks in the region hit a 20-year peak on Wednesday, expecting European central bankers to maintain a more hawkish stance compared to their U.S. counterparts to control rising prices.

LVMH Shares Boost STOXX 600, FTSE 100 Stagnates

The broader STOXX 600 index climbed 0.3%, supported by LVMH shares reaching a record high after the luxury retailer reported strong sales in China for Q1 2023. Meanwhile, London's FTSE 100 lagged behind the rest of the region as data revealed the British economy stagnated in February.

U.S. Producer Prices and Retail Sales Data to Impact Fed's May Decision

Upcoming U.S. producer prices and retail sales data could affect the Federal Reserve's decision expectations in its May meeting. Wholesale prices are anticipated to have increased by 3% in March, down from February's 4.6% growth.

U.S. Inflation Annual Headline Rate Lowest Since May 2021

The U.S. consumer inflation annual headline rate reached 5% in March, the lowest since May 2021 and a decrease from 9.1% in June. However, the core CPI remains at an annual 5.6%, and last month's Fed meeting minutes revealed cautiousness about credit tightening due to banking sector instability in March.

Dollar Index Down, U.S. Stock Futures Indicate Modest Rally

The dollar index dipped 0.14%, staying close to its lowest point in two months, while U.S. stock futures rose between 0.1-0.2%, suggesting a modest opening rally. The focus for the week will be on earnings from Citi, Wells Fargo, and JP Morgan Chase.

Jan Hatzius
Jan Hatzius

No Major Bank Crises Despite Pressure on Regional Lenders

Goldman Sachs' chief economist Jan Hatzius expressed optimism that the risk of a banking crisis has decreased, with no further bank collapses since Silicon Valley Bank's failure a month ago. However, regional lenders still face pressure, as demonstrated by the Bank of South Carolina's Q1 earnings.

Gold Rises to $2,028, Chinese Exports and Australian Jobs Surge

Gold prices increased by 0.65% to $2,028 an ounce, near its highest point in a year. The weaker dollar and potential decline in interest rates make gold more competitive for investment, particularly as a hedge against persistent inflation. Meanwhile, the Australian dollar rose 0.6% following surprise surges in Chinese exports and domestic Australian jobs.