Indications by the European central bank (ECB) that it will raise its interest rates have prompted a surge in the Euro earlier in the week as stock markets entered a rally.
The S&P 500 Wall Street index was seen moving out of the bear market with a 1.86% jump while the Dow Jones Industrial average index hit 1.98% and the Nasdaq Composite added 1.59% in a less volatile trading session.
Growth stocks rose 1.98% to outpace the 1.74% gain in value stocks.
Although U.S. stocks entered the rally, analysts said the equity slump is not over.
According to Mizuho Securities chief economist Steven Ricchiuto, investors are under the illusion of monetary policy easing by the Federal Reserve (Fed) that could affect growth.
Clearly, growth will slow and the Fed will not be able to stop it even if they loosen monetary policy, instead the equity market will have to adjust to the uncertainty.
Ameriprise global market strategist Anthony Saglimbene also supported by stating that bears are still firmly in control of the entire market.
The 10 -year yield Treasury Notes added 7.7 basis points at 2.864% after declining more than 40 basis points from a multi -year high of 3.203%.
On the other hand, the MSCI worldwide index rose 1.54% even though it was still below 17% from a record high in January while the pan-European STOXX 600 rose 1.26%.
Heading into European markets, President Christine Lagarde’s decision to speed up the policy recovery but reject rate hikes so far in the face of inflation has been a shift to the Euro.
The high rate outlook pushed the Euro up 1.24% at $ 1.0691 while the dollar index, which measures a number of other currencies, slipped 0.855% even as it rose 16% to a 12 -month high in mid -May.
Gold futures rose 0.3% at $ 1,847.80 per ounce while Bitcoin fell 3.55% at $ 29,189.85.
