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HomeBusinessEuropean and Asian stocks surge following positive China industrial data.

European and Asian stocks surge following positive China industrial data.

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Asian and European stock markets rebounded on Wednesday following recent losses, as investors reacted positively to improved industrial data from China. Hong Kong’s Hang Seng index and China’s CSI both saw gains after a two-day losing streak. In Europe, the Stoxx Europe 600 index also rose, with tech and healthcare stocks contributing to the increase. The data from China showed an 11.7% year-on-year decline in industrial sector profits for the first eight months of 2023, a smaller contraction compared to the previous seven months. This suggests that recent support measures may be helping stabilize the world’s second-largest economy.

Energy and industrial stocks were among the driving forces behind the rise in the CSI 300 index, with gains of 1.3% and 0.4% respectively. Strong economic data also pushed up oil prices, which have already increased by 30% since June due to supply cuts by major oil producers. International benchmark Brent crude rose 0.7% to $94.6, and West Texas Intermediate increased by 1.1% to $91.35. Investors are now looking to US durable goods orders data, due later in the day, to assess the state of the economy more than a year after the Federal Reserve began tightening monetary policy to combat inflation.

Despite the Fed’s restrictive policy, the resilient US economy has helped push Treasury yields to multiyear highs and strengthen the dollar. On Wednesday, yields on the benchmark 10-year Treasury slipped to 4.51%, while yields on the 30-year note rose to 4.65%. The dollar remained relatively stable against a basket of six peer currencies, maintaining its highest level since November 2022. Contracts tracking the S&P 500 and Nasdaq 100 also advanced 0.3% ahead of the New York market opening.

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