· StanChart restores dividend, reaffirms targets as COVID-19 halves profit
· AB InBev forecasts higher 2021 earnings but margin pressure
· Dow futures rise 100 points following index’s record close
U.S. stock index futures moved higher in early morning trading Thursday after the Dow closed at a record level.
Futures contracts tied to the Dow Jones Industrial Average gained 111 points. S&P 500 futures and Nasdaq 100 futures also both traded in positive territory.
The move comes after the Dow jumped 425 points on Wednesday to close at a record high in a volatile session that at one point saw the 30-stock average drop more than 110 points. The S&P 500 advanced 1.1%, while the Nasdaq Composite gained 1%. Earlier in the session, the tech-heavy index was down 1.3%.
Rising rates weighed on stocks early in the session as the U.S. 10-year Treasury yield topped 1.4% and hit its highest level since February 2020. Higher rates could spur investors to rotate out of stocks and into bonds. Higher rates could also hit the growth-oriented technology sector especially hard.
· Further rise in bond yields to be ‘negative for Asian equities’: HSBC
Herald Van Der Linde of HSBC says that the reflation story has been very supportive for Asian equities, but the positive effects may be running out.
· World shares jump after Powell nixes rate hike fears
Global stocks jumped on Thursday after U.S. Federal Reserve Chair Jerome Powell reaffirmed interest rates would stay low for a long time, calming market fears that higher inflation might prompt the central bank to tighten monetary policy.
Powell’s reassurance gave a fresh impetus to reflation trades and boosted risk asset prices while also driving U.S. bond yields back up to one-year highs.
European stocks are expected to open higher, with Euro Stoxx 50 futures and FTSE futures both up about 0.6%.
In Asia, MSCI’s ex-Japan Asia-Pacific shares index rose 1.5% while Japan’s Nikkei gained 1.7%.
· Japan's Nikkei reclaims 30,000-mark as economic optimism swells
Japan’s Nikkei index closed above the 30,000-mark on Thursday after Federal Reserve Chair Jerome Powell views signalled that interest rates will remain low for an extended period.
The Nikkei share average ended up 1.67% at 30,168.27. The broader Topix rose 1.22% to 1,926.23.
On Wall Street, all three main indexes ended higher, on track to post strong monthly gains, with the Dow and the S&P 500 set for their best month since November.
Stocks on the move
Shares of South Korean chipmaker SK Hynix soared more than 8% in Thursday trade.
The moves came after Nvidia reported fourth-quarter earnings and revenue that topped elevated analyst expectations against the backdrop of a global semiconductor shortage, which has hit sectors ranging from gaming to autos.
Standard Chartered earnings
On the earnings front, Standard Chartered Bank reported 2020 pretax profit of $1.61 billion, plunging 57% from a year ago. That figure is lower than the $1.85 billion average of analyst forecasts compiled by the bank, according to Reuters.
· China shares end higher on gains in property firms
China shares rebounded on Thursday, as strong gains in the property sector helped the market recover from sharp losses made a day earlier.
At the close, the Shanghai Composite index was up 0.59% at 3,585.05, while the blue-chip CSI300 index was ended 0.59% higher at 5,469.56.
· European markets follow the pack as global stocks trend higher
European stocks opened modestly higher Thursday, as global markets jumped following reassuring comments from Federal Reserve Chairman Jerome Powell on the inflation outlook.
The pan-European Stoxx 600 gained 0.2% in early trade, with oil and gas adding 1.2% to lead gains while food and beverages slid 1.3% lower.
European markets are following their global counterparts higher; stocks in Asia-Pacific jumped in Thursday trade and U.S. stock index futures gained in overnight trading after the Dow Jones Industrial Average surged to a record closing high during trading hours Wednesday.
· Investors are turning bullish on Italy as Draghi prepares new reforms
Mario Draghi’s new government could be good for financials and consumer recovery plays, an analyst told CNBC, as investors turn more bullish on Italian stocks.
The former European Central Bank chief has ambitious plans to reform the country, including Italy’s judiciary, public administration and tax system — an agenda welcomed by market players who have been tentative on Italy as multiple governments struggled to pass through any meaningful reforms in recent years.
“Accomplishing structural reform will be difficult. But after a long period of Italian underperformance, expectations are low. So any signs that Draghi may succeed in achieving growth-boosting structural reforms could lead to an upward rerating of Italian assets,” analysts at investment research firm Gavekal Research said in a note.
The FTSE MIB, Italy’s main stock market index, has risen about 7% from a low on Jan. 29 on the back of Draghi’s appointment. But experts believe there is further room to grow.
Strategists at UniCredit last week forecast that large and mid-cap segments of the Italian market could have “an absolute performance potential of about 10% from current level” in 2021.
Reference: CNBC, Reuters
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