Global stocks extended a record, with Japanese shares rallying after a three-day holiday amid optimism on improving economic growth. The euro retreated following Emmanuel Macron’s victory as France’s next president.
Tokyo and Seoul led equities markets higher after US stocks closed at a record Friday on better-than-forecast data on American jobs. European stocks were among the few losers, dragged down by commodities producers, while Chinese stocks extended a selloff that has wiped more than $400 billion from the value of local shares. The euro was lower, with investors having largely positioned for Macron’s victory in the run-up to Sunday’s vote. Oil rose with gold.
“It’s steady as she goes in terms of the risk-on trade again,” Dwyfor Evans, head of Asia-Pacific macro strategy at State Street Global Markets in Hong Kong, told Bloomberg TV. “It’s a very good outcome for risk generally.”
With the hurdle determining France’s new leader now cleared, investors are turning their focus on global growth and corporate earnings, after last week’s robust American jobs report and Federal Reserve comments bolstered optimism in the US economy.
In China, domestic equities and bonds are being hit by the government’s steps to rein in financial leverage. The country’s banking, insurance and securities regulators have all played a part in the clampdown, focusing much of their attention on the nation’s shadow banking system. The selloff that began last month continued Monday, even after data showed China’s overseas shipments held up in April.
The MSCI All-Country World Index increased 0.2 percent to a fresh record as of 8:16 a.m. in London, while the MSCI Asia Pacific Index jumped 1.3 percent to the highest since June 2015.
The Topix index rose 2.3 percent, the most since Jan. 4. The gauge is at the highest since December 2015, surpassing a peak reached in March.
The Stoxx Europe 600 slipped 0.1 percent, pulled down by raw-material producers. South Korea’s Kospi index jumped 2.3 percent, the most since September 2015, to a fresh record ahead of tomorrow’s election. The Shanghai Composite Index dropped 0.8 percent to the lowest level since October.
China’s overseas shipments held up in April, edging down from a two-year high in March. The export outlook has improved on recovering global demand and as the threat of a trade war with its biggest trading partner fizzled. Futures on the S&P 500 were down 0.2 percent. The benchmark gauge climbed 0.6 percent last week, closing Friday at an all-time high.
The euro fell 0.3 percent to $1.0963, after gaining as much as 0.2 percent earlier. The currency is still trading near the highest level since November. The yen was little changed at 112.68 per dollar, near the lowest level in seven weeks. The Bloomberg Dollar Spot Index advanced 0.1 percent following four straight weeks of declines. Bloomberg
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