(Bloomberg) — Stocks rose Wednesday amid a retreat in the dollar and speculation that the worst of this year’s equity rout may be over.
The Stoxx 600 Index extended a fourth straight day of gains that took it to the highest closing level in nearly six weeks, amid signs Russia will restart gas exports to Europe through the Nord Stream pipeline on Thursday, albeit at reduced capacity.
US contracts were in the green too, encouraged by a Netflix Inc. surge in extended trading on a smaller-than-expected subscriber loss.
The euro hovered around a two-week high against the dollar on the possibility of a bigger-than-expected European Central Bank interest-rate hike Thursday.
Speculation that company earnings will hold up and that the Federal Reserve will avoid very aggressive monetary tightening is giving investors some hope. Worries about a global downturn due to rising interest rates, Europe’s energy challenges and China’s Covid and property-sector woes are taking a back seat.
“Stocks have been beaten down,” Kristina Hooper, chief global market strategist at Invesco, wrote in a note. “That doesn’t mean we won’t see more downside for some stock markets around the world, especially given that earnings expectations are likely to be adjusted downward. But I believe we are far closer to the bottom than the top.”
A dollar gauge has shed about 1% this week, underscoring waning haven demand for the greenback and a brighter mood in markets. Treasuries held a decline that’s taken the 10-year yield back above 3%.
West Texas Intermediate crude oil slipped below $103 a barrel. Bitcoin hovered above $23,000 after climbing out of a one-month-old trading range.
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Key events to watch this week:
- Earnings this week include Tesla
- US Treasury Secretary Janet Yellen visits South Korea. Tuesday
- Reserve Bank of Australia releases July minutes. Tuesday
- UK Chancellor Nadhim Zahawi and Bank of England Governor Andrew Bailey speak at event. Tuesday
- Bloomberg Crypto Summit in New York. Tuesday
- Bank of Japan, European Central Bank rate decisions. Thursday
- Nord Stream 1 pipeline scheduled to reopen following maintenance. Thursday
Some of the main moves in markets:
Stocks
- The Stoxx Europe 600 rose 0.4% as of 8:30 a.m. London time
- Futures on the S&P 500 rose 0.4%
- Futures on the Nasdaq 100 rose 0.4%
- Futures on the Dow Jones Industrial Average rose 0.3%
- The MSCI Asia Pacific Index rose 1.5%
- The MSCI Emerging Markets Index rose 1%
Currencies
- The Bloomberg Dollar Spot Index fell 0.1%
- The euro rose 0.3% to $1.0261
- The Japanese yen was little changed at 138.15 per dollar
- The offshore yuan fell 0.1% to 6.7533 per dollar
- The British pound rose 0.2% to $1.2018
Bonds
- The yield on 10-year Treasuries was little changed at 3.01%
- Germany’s 10-year yield advanced one basis point to 1.29%
- Britain’s 10-year yield declined two basis points to 2.16%
Commodities
- Brent crude fell 1.2% to $106.06 a barrel
- Spot gold fell 0.2% to $1,708.08 an ounce
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