Global stock markets were largely upbeat Thursday, after the
U.S. Federal Reserve refrained from sending clear signals that it
would raise interest rates in September, and with robust corporate
earnings providing cause for greater optimism in Europe.
In early trade the Stoxx Europe 600 added 0.5%, building on
gains made in the two previous sessions.
On Wednesday in the U.S., both the S&P 500 and the Dow Jones
Industrial Average advanced 0.7%, and the Nasdaq Composite gained
0.4% after the statement from the Federal Reserve.
Many investors globally have been forecasting that the Fed could
raise interest rates as early as September. Wednesday's statement,
however, also flagged concerns that inflation remains too low.
That is making officials hesitant on the timing and inclined to
raising rates very gradually after the first increase.
"The Fed did indicate that we are getting closer to the first
rate hike […] however, it remains unclear whether the continued
improvements in the labor market, the housing market and economic
activity in general will be sufficient to hike at the next meeting
in September," Rabobank strategist Philip Marey said.
Peter Chatwell, a rates strategist at Mizuho, said that
September may still be on the table but that very much depends on
the economic data over the next few weeks.
A first reading for second-quarter U.S. gross domestic product,
the broadest sum of goods and services produced across the economy,
is due Thursday.
In Europe, shares in Royal Bank of Scotland Group PLC rose
sharply after the lender reported a rise in second-quarter net
profit.
Shares in Royal Dutch Shell PLC rallied too. The oil major
reported a sharp fall in second-quarter profit and said it would
cut 6,500 jobs, illustrating the strain that sustained low oil
prices are putting on large producers. Separately, Shell said it
had agreed to sell a 33.2% stake in its Japanese oil refining unit,
Showa Shell Sekiyu KK, to Japan's Idemitsu Kosan Co for ¥ 169
billion or $1.4 billion.
Nokia Oyj shares topped the pan European index, surging more
than 8% shortly after the market open. The Finnish company reported
a better-than-expected second-quarter profit boosted by
significantly higher software sales, which offset challenging
market conditions.
In Asia on Thursday, the Shanghai Composite closed down 3.2%.
The Nikkei Stock Average ended the session up 1.1%, helped by a
weaker yen.
Elsewhere in currency markets, the euro was around 0.2% lower
against the dollar at $1.096 in early European trade.
Brent crude was 0.4% higher at $53.58 per barrel. Gold lost 0.9%
to $1,083.40 per troy ounce.
Write to Josie Cox at josie.cox@wsj.com
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