WASHINGTON/LONDON: World stocks rallied yesterday, with Wall Street rising again on a Big Tech boost and European shares gaining on strong earnings as investors put aside worries about rising interest rates for now.
The benchmark 10-year US Treasury yield slipped from multi-year highs hit in the previous session, helping steady sentiment across global markets and boosting demand for growth stocks. The S&P 500 and the Nasdaq Composite jumped more than 1% as tech stocks extended their rally.
The Dow Jones Industrial Average rose 0.86% to end at 35,768.06 points, while the S&P 500 gained 1.45% to 4,587.18.
The Nasdaq Composite climbed 2.08% to 14,490.37.
Earlier in the day, MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.8% to a more than two-week high and the blue-chip Nikkei closed just over 1% higher.
Hong Kong jumped more than 2% thanks to a 6.8% surge in market heavyweight Alibaba after Japan's SoftBank allayed fears it was planning to offload some of its huge holdings in the e-commerce giant.
Europe followed Asia's lead higher, with both Frankfurt and Paris posting gains of around 1.5%.
The pan-European STOXX 600 rose 1.7% with automakers leading gains with a 4.0% jump.
Traders have also been cheered by the rollback of Covid restrictions in many nations, with London's FTSE 100 hitting a two-year high as tourism stocks have taken off.
Investors also took comfort in positive news headlines over recent days suggesting tensions between the West and Russia over Ukraine may be easing and a string of upbeat earnings lifted sentiment towards risk assets.
With speculation swirling over the Federal Reserve's plans to battle soaring prices, global equities have fluctuated wildly since the start of the year as traders try to position themselves for a series of interest rate increases that are likely to begin in March.
The prospect of the removal of cheap cash – which has pushed markets to record or multi-year highs – has particularly hit tech firms as they are more susceptible to higher rates.
Market analyst David Madden at Equiti Capital credited Wall Street's newfound vigour to ebbing worries over both the Fed's course of action, and the possibility of war in Ukraine.
“The fear factor surrounding those potential outcomes has declined, hence why we are seeing indices drive higher again,“ he said. – Reuters, AFP