The US S&P 500 index hit an all-time high overnight on better than forecast earnings and trade negotiation optimism. Gains in European stocks and pressure on gold and bonds underpin growth optimism and early indications point to gains across the Asia Pacific region today.
As the US corporate reporting season approaches the half-way mark both sales and profits are slightly ahead of analysts’ estimates. Google owner Alphabet reported lower earnings on increased cloud spending, but still managed an almost 2% lift. Shares in jeweller Tiffany’s lifted again to trade above the proposed bid from Louis Vuitton.
President Trump told reporters that phase one of the China/US trade deal will be signed ahead of schedule, but did not give a date. However defensive positioning from investors as the stocks approached levels hit earlier this year meant this was enough to trigger a share market surge.
Signals from foreign exchange markets were more muted. The US dollar rose against the Japanese yen but fell against the Euro. However gains for the Australian, New Zealand and Canadian dollars tip the balance in favour of growth. Crypto currencies remain elevated after the surge inspired by President Xi’s weekend endorsement of blockchain technology, although CMC’s All Crypto index slipped below 3,000.