“Asia Shares Rally as Rate Cut Bets Rise, ECB in Focus”, The sentiment is upbeat in Asian markets, fueled by growing anticipation of a Fed interest rate cut in September. Investors are also closely monitoring the European Central Bank meeting, with widespread expectations of a rate cut, contributing to a strengthening euro.
Oil prices surged while Treasury yields plummeted to their lowest in two months as anticipation of a Federal Reserve rate cut grew. The dollar faced downward pressure following indications of a softening U.S. labor market this week. This dynamic underscores investors’ cautious outlook amid economic fluctuations.
“Asia-Pacific Shares Outside Japan Surge 1.28%: MSCI Index Set to End Two-Week Losing Streak”
The exuberance in markets looked set to continue in Europe, futures indicated. Eurostoxx 50 futures was 0.46 per cent firmer and FTSE futures rose 0.27 per cent ahead of the ECB policy meeting later in the day.
Meanwhile, the tech-heavy Taiwan stock index surged more than 2 per cent to touch a record high.
Indian stocks also rose as investors moved past shock election results that reduced the ruling party’s margin of majority and unnerved markets about the path of economic policies in a turbulent week for Indian assets.
The ECB meeting will kick off a fresh round of central bank policy reviews, with the Fed and the Bank of Japan due to meet next week and after Bank of Canada cut rates on Wednesday, the first G7 country to do so, in a widely expected move.
The ECB is all but certain to cut interest rates from record highs on Thursday but investor focus will be on comments and economic projections to gauge what comes after the expected rate cut. Markets are pricing in 64 basis points of cuts this year.
