- U.S. equities rose, benefiting from earnings performance, while U.S. Treasuries edged higher
- European equities rose, while bonds edged lower
- Asian equities broadly rose
U.S. stocks rose, and the earnings quarter entered its peak
U.S. stocks closed higher on Tuesday as investors digested corporate earnings and prepared for the upcoming results of big tech stocks. The S&P 500 rose 1.2%.
U.S. Treasuries edged higher (yields declined) on the back of poor U.S. purchasing managers' indices and solid demand for two-year Treasury issuance. The yield on 10-year and two-year Treasury bonds fell 1 and 4 basis points to 4.60% and 4.93%, respectively.
European stocks extended gains on Tuesday, buoyed by a higher-than-expected preliminary Eurozone PMI for April. The Dow Jones Europe 50 rose 1.4%. Germany's DAX and France's CAC rose 1.6% and 0.8%, respectively. Britain's FTSE 100 rose 0.3%.
European government bonds fell slightly (with higher yields), but US data was weaker than expected. The German 10-year government bond yield edged up 1 basis point to 2.50%, and the French 10-year government bond yield rose 2 basis points to 3.00%. The yield on 10-year UK government bonds climbed 4 basis points to 4.24% after hawkish comments from the Bank of England's chief economist Huw Pill diluted hopes of an early rate cut.
Asian stocks were broadly higher on Tuesday as markets waited for more earnings reports from the U.S. and Asia. Japan's Nikkei 225 rose 0.3% on the spotlight on upcoming domestic quarterly results and the Bank of Japan's policy decision. Hong Kong's Hang Seng Index rose 1.9%, but China's Shanghai Composite Index extended its decline, falling 0.7%. India's Sensex index edged up 0.1% on some positive earnings announcements.
Oil prices rose on Tuesday amid a general risk-on sentiment. U.S. oil prices rose 0.6% to $83.4 a barrel in June.
Key data announcements and market events
yesterday
The Eurozone Composite PMI rose to 51.4 in April from 50.3 in March, higher than market expectations.
The UK Composite Purchasing Managers' Index rose to 54.0 in April from 52.8 in March, the highest level since May 2023, indicating that the UK economy is in the early stages of recovery.
The S&P Global Composite Purchasing Managers' Index fell to 50.9 in April from 52.1 in March, suggesting that growth in the United States has softened at the beginning of the second quarter of 2024 and is generally weak. On the other hand, new home sales in the United States surged 8.8% in March (month-on-month), but the February data was revised downward to -5.1% (month-on-month).
Economic data released today (24 April 2024)
Germany's IFO business confidence index is expected to rise to 88.8 in April from 87.8 in March, but risks are skewed to the downside due to the sluggish manufacturing PMI in April.
U.S. durable goods orders are forecast to rise 2.5% (month-on-month) in March, following a 1.3% increase in February.
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