Meanwhile, US GDP expanded less than expected in Q1 and the PCE index confirmed inflation’s stubborn grasp on the economy.
ASX Futures: were 60 points or 0.8% higher as of 6:00am on Friday, suggesting gains at the open.
US Stock Market
US stocks finished Thursday higher as strong results from Meta Platforms boosted tech-related names.
- The Dow Jones Industrial Average advanced 1.6%
- The Nasdaq Composite jumped 2.4%
- The S&P 500 climbed 2.0%
It was the best day since January for the Dow and S&P 500 and since March for the Nasdaq.
Meta shares leapt 13.9% after the company reported quarterly revenue that topped expectations and issued an upbeat forecast. Several analysts hiked their price targets following the release. Shares of other tech-related names such as Amazon, Alphabet, Microsoft, and Apple also popped.
Commodity Markets
- Brent crude oil added 0.9% to US$78.35 a barrel
- Gold inched 0.1% lower to US$1,987.92
Bond Markets
- Australian government bonds climbed, with the 2 Year yield increasing to 3.04% and the 10 Year yield rising to 3.37%.
- US Treasury notes were mixed, with the 2 Year yield increasing to 4.08% and the 10 Year yield tripping to 3.52%.
Currency Markets
- The Australian dollar increased to 66.28 US cents from its previous close of 66.02.
- The Wall Street Journal Dollar Index, which tracks the US dollar against 16 other currencies, inched lower to 95.91.
Asia
Chinese Shares: ended higher, reversing early losses as positive catalysts shored up investor confidence. Geopolitical tension eased after Chinese leader Xi Jinping made his first phone call Wednesday night to Ukrainian President Volodymyr Zelensky since the Russian invasion.
Insurers and pharmaceutical companies led the gainers. Ping An Insurance rose 10%, its daily limit, after it released strong Q1 earnings. Shenzhen Mindray Bio-Medical Electronics increased 2.8% and Shanghai United Imaging Healthcare was up 4.4%.
- The Shanghai Composite Index ended 0.7% higher at 3285.88
- The Shenzhen Composite Index closed 0.1% higher
- The ChiNext Price Index increased 0.6%
Hong Kong
Hang Seng Index: closed 0.4% higher at 19840.28. The release of Q1 earnings from various large Hong Kong-listed companies are likely to remain in focus this week. Worries regarding the banking sector as well as recession fears mean risk sentiment could stay cautious in the near term.
Gainers on the HSI included Ping An Insurance, which closed 9.0% higher after reporting Q1 earnings. Other gainers included Citic Ltd., which rose 5.5% and China Life Insurance, which added 5.1%.
Japan
Nikkei Stock Average: edged 0.2% higher to close at 28457.68, reversing earlier losses ahead of the Bank of Japan's monetary policy decision due out Friday. Gains on the benchmark index were led by a mixed bag of companies:
- Nitto Denko climbing 6.2%
- Canon adding 5.2%
- Sony Group up 3.5%
Meanwhile, Advantest slumped 9.2% after projecting a 40% drop in its fiscal-year net profit, and Nomura Holdings shed 7.2% after its fiscal-year net profit declined 35%.
India
Sensex Index: rose 0.6% to close at 60649.38 ahead of US advance estimate Q1 GDP growth data due out later Thursday. Any data that matches expectations may not derail current momentum for equity bulls, who are hoping better-than-expected tech earnings will increase appetite for riskier assets.
The best performers on the Sensex included:
- Bajaj Finance, which rose 2.4%
- Bajaj Finserv, which added 1.9%
- Bharti Airtel, which was up 1.6%
Europe
European stocks traded mixed Thursday, though Wall Street was heading higher on mostly positive economic data. The pan-European Stoxx Europe 600 added 0.2%, the French CAC 40 gained 0.2%, and the German DAX was flat.
UK’s FTSE 100 closed down 0.3% due to underperformance in energy, and particular weakness in BP and Shell. Barclays ended the day as the biggest gainer, up 5.3%, after positive first-quarter numbers driven by a strong performance in its investment banking division and good performance at its consumer division.
North America
US stocks finished Thursday higher as strong results from Meta Platforms boosted tech-related names.
- The Dow Jones Industrial Average advanced 1.6%
- The Nasdaq Composite jumped 2.4%
- The S&P 500 climbed 2.0%
Meta shares leapt 13.9% after the company reported quarterly revenue that topped expectations and issued an upbeat forecast. Several analysts hiked their price targets following the release. Shares of other tech-related names such as Amazon, Alphabet, Microsoft, and Apple also popped.
Market Insights
“The market was waiting with bated breath for Big Tech,” said Quincy Krosby, chief global strategist at LPL Financial. “Across the board, it hasn’t disappointed, and the market needed that.”
Stocks rose despite weaker-than-expected GDP data, which may suggest to some investors that the Federal Reserve could soon wrap up its tightening campaign. The Fed is slated to announce its latest policy decision next week.
The US economy grew 1.1% in the first quarter, while economists polled by Dow Jones forecasted an expansion of 2%. The report also showed stronger-than-expected inflation, with prices increasing 4% compared with a consensus estimate of 3.7%.
Honeywell, an industrial bellwether, added more than 4% on the back of a quarterly report that was better than Wall Street expected. Teladoc and Comcast were among the other companies trading higher after releasing earnings reports.
However, Caterpillar, another barometer of the global economy, fell around 0.9% as investors feared a build-up in inventory suggests demand is slowing.
The Dow and S&P 500 are slightly above their flatlines for the week-to-date, while the Nasdaq has gained 0.6% over the same period. But the Nasdaq has lagged on a month-to-date basis, shedding 0.7% while the Dow and S&P 500 rose 1.7% and 0.6%, respectively, since the beginning of April.
