Global stocks extend gains

Bloomberg

Global stocks extended gains on Monday after posting their best performance in a month last week.
US futures rise, with the Nasdaq 100 advancing 0.6% and technology heavyweights including Amazon.com Inc., Apple Inc. and Microsoft Corp. climbing in premarket trading. Tech shares also boosted indexes in Europe and Asia.
Quarterly portfolio rebalancing by institutional buyers could be helping equities, as investors assess whether inflation is cresting and recession can be averted. JPMorgan Chase & Co.’s Marko Kolanovic is calling for stocks to rise 7% this week as pension and sovereign wealth funds shift their exposures.
Treasuries slipped, pushing the rate on the US 10-year note to 3.16%. Yields have retreated from June highs on growth worries, but whether that marks the end of the Treasury bear market is a live debate. The
dollar fluctuated.
Industrial metals rebounded, while oil rises. A degree of improvement in China’s economy amid easing Covid restrictions may be helping sentiment
towards raw materials.
Among notable European stock moves, Prosus NV soared on plans to sell more of its $134 billion stake in Chinese internet giant Tencent Holdings Ltd. to finance a buyback program. Mediobanca SpA fell after the death of Italian entrepreneur Leonardo Del Vecchio, the single largest investor in the bank.
Meanwhile, one of Wall Street’s most prominent bears sees the rally in US stocks extending — prior to the selloff recommencing. Morgan Stanley strategists led by Michael Wilson say the S&P 500 Index may climb another 5% to 7%, before resuming losses.
Investors are parsing incoming data to work out if the highest inflation in a generation is close to topping out. In time, that could give policy makers latitude to ease up on sharp interest-rate hikes. A more troubling scenario is of lasting price pressures and tighter policy even as the global economy falters.
“There’s a feeling that things aren’t as bad as we thought they were going to be,” Carol Pepper, founder of Pepper International, said on Bloomberg Radio. She added “there’s a hope that perhaps we’ve oversold, perhaps there’s not going to be a recession.”
Elsewhere, Russia defaulted on its foreign-currency sovereign debt for the first time in a century, the culmination of ever-tougher Western sanctions that shut down payment routes.
Traders are monitoring a summit of the Group of Seven leaders, who plan to commit to indefinite support for Ukraine in its defense against Russia’s invasion. The G-7 in addition is weighing a price cap on the Russian oil.
The US, UK, Japan and Canada also plan to announce a ban on new gold imports from Russia during the G-7 summit. Prices for the precious metal rise.
Futures on the S&P 500 rose 0.4% as of 7:25 am New York time and futures on the Nasdaq 100 also climb 0.6%.
While futures on the Dow Jones Industrial Average rose 0.3%. the Stoxx Europe 600 rose 0.6% and the MSCI World index also rises 2.6%..
The Bloomberg Dollar Spot Index was little changed and the euro rose 0.2% to $1.0577. The British pound was little changed at $1.2266 and the Japanese yen was little changed at 135.32 per dollar.
The yield on 10-year Treasuries advanced three basis points to 3.16% and Germany’s 10-year yield advanced 10 basis points to 1.54%. Britain’s 10-year yield advanced seven basis points to 2.38%
West Texas Intermediate crude rises 0.3% to $107.97 a barrel and gold futures rose 0.4% to $1,837.70 an ounce.