European stocks rose for a second day after strong earnings from some of the region’s biggest companies, while positive economic data helped boost sentiment. The Stoxx Europe 600 index climbed 0.6%, with the technology sector leading the advance.
Earnings are front and center of investor’s minds this week with about 180 companies — representing over 40% of the S&P 500 market value — reporting results. The focus on corporate profits comes after a rout fueled by geopolitical fears and signals the Federal Reserve will be in no rush to lower rates.
PMI data on Tuesday reinforced bets the European Central Bank is on course to start easing policy soon. Private-sector activity advanced to the highest level in almost a year, driven by a buoyant services sector and Germany’s return to growth. Barring any economic surprises, a rate cut in June is a “fait accompli,” ECB Vice President Luis de Guindos said. The euro gained against the dollar.
Treasuries were steady before a flurry of bond auctions that will test investors’ appetite after yields hit the highest in 2024. A gauge of the greenback was little changed.
The UK 10-year yield ticked higher after the government raised the amount of bonds it plans to sell this fiscal year by more than analysts expected, adding to what was already the second-largest gilt package on record.
Gold extended losses after its biggest daily decline in almost two years, with easing tension in the Middle East and signs the Fed will keep rates higher for longer crimping demand. Oil nudged higher as traders weighed the next steps between Israel and Iran amid signs of easing hostilities following a tit-for-tat exchange of attacks last week.
In India, the Sensex and Nifty continued to maintain their momentum and closed in the green for the third straight session on Tuesday, following positive cues from global peers as investors shifted focus from the Israel-Iran conflict to companies’ results. Sensex closed at 73,738.45, up 89.83 points, or 0.12%, while Nifty closed at 22,368, up 31.60 points, or 0.14%.
On the 30-stock BSE Sensex, 13 closed in the red, with losses led by Sun Pharma, Reliance Industries, Mahindra & Mahindra, JSW Steel, and Tech Mahindra. On the Nifty 50, half of the stocks closed in the red, with losses led by Sun Pharma, BPCL, Reliance Industries, Dr Reddy’s, and Hindalco.
The broader market outperformed the benchmark indices, with the BSE SmallCap index closing up 1.05%, and the BSE MidCap index up 0.52%. All sectoral indices ended the day in the green, except for Pharma, Healthcare, Oil & Gas, and Metal.
The Realty index gained the most, up 2.58%, followed by the FMCG and Consumer durables indices, which closed up 0.76% and 0.65%, respectively. Overall, the market showed positive signs and investors are optimistic about the future outlook.
