World Economy

World Stocks, Commodities Climb

World Stocks,  Commodities Climb World Stocks,  Commodities Climb

World markets had a swagger about them on Tuesday as upbeat economic data and signs of a revival in inflation pushed up stocks and commodity prices and kept the dollar at a nine-month high.

Factory surveys in the United States and Europe had boasted the best readings of the year so far on Monday and a six-month high for Japanese stocks in Tokyo overnight had followed a record close for the tech-heavy U.S. Nasdaq.

European markets started with Germany's Dax. nudging its highest level of the year as the closely-watched Ifo sentiment survey beat expectations a day after purchasing manager numbers had done the same.

US stock index futures were little changed on Tuesday as investors await earnings reports from a host of companies, including Apple.

Dow component Merck rose 2.2 % to $62.10 in premarket trading after the company reported a 19.6 % rise in quarterly net profit.

Apple , which is scheduled to report results after the close of the bell, was up 0.46 % at $118.19.

The region's mining firms .SXPP were the standout performers though as they hit a 14-month top as zinc surged to a five-year peak and iron ore reached its highest since mid-2014, all of which should pick up the pulse of inflation globally, Reuters reported.

"We are seeing a pick up of economic activity against the backdrop of only one central bank -- the Fed -- that is likely to tighten policy and that is supporting asset markets," said CMC Markets senior analyst Michael Hewson.

In the foreign exchange markets, the dollar .DXY took a breather having reached its highest since early February against other top currencies as traders continued to add to the bets on a December U.S. interest rate rise. China's yuan went the other way, hitting its lowest since 'offshore' trading was introduced in 2010 as Beijing nudged down official rates again.

It traded as soft as 6.7882 yuan per dollar. The currency's fall of more than 1.5 % since the end of September has prompted renewed suspicion of a possible extended slide in the yuan, even though officials have reiterated their expectations for a stable currency.

But the weakness has revived memories of a shock yuan devaluation last August and another rapid depreciation early this year - falls that triggered a bout of global market turmoil.

But analysts pointed out that during this round of yuan weakness, global risk sentiment was holding up.

"That highlights the extent to which dollar gains are unlikely to be as extended as they were (in the past)," said BNP Paribas currency strategist Sam Lynton-Brown, in London.


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