European Stock Markets Rise, Driven by Hopes of Interest Rate Cuts and Corporate Earnings
Global stock markets rallied again, driven by expectations of an interest rate cut by the Fed and solid corporate earnings reports. The Stoxx Europe 600 Index recorded a second consecutive day of gains, led by a surge in BP shares after announcing above-expected earnings and a share buyback program. Shares of DHL, Diageo, and Infineon Technologies also rose thanks to strong financial results.
In the US, S&P 500 and Nasdaq 100 futures rose 0.3% and 0.4%, respectively, continuing the previous day's rally. Investors are increasingly confident that the Fed will cut interest rates at its September meeting, especially after last week's weak US employment data. The market now rates a 25 basis point rate cut at over 80%.
However, several analysts warn of a potential market correction in the near term. Morgan Stanley, Deutsche Bank, and Evercore have stated that overvalued stocks could come under pressure in the face of weakening economic data. However, some market players remain optimistic, believing that moderate weakening could actually accelerate monetary policy easing.
Meanwhile, trade tariffs remain a concern. Trump is expected to announce executive action to lower tariffs on European cars and grant exemptions for some industrial goods. Meanwhile, Japan and Switzerland are working to improve their trade relations with the US amid the escalation in tariffs announced last week. (ayu)
Source: Newsmaker.id
