European markets are broadly positive on Tuesday after data showed the decline in producer prices in China slowed whilst a recovery in commodity markets eased concerns of another rout. A smaller than expected loss at Credit Suisse (SIX:CSGN) has been a positive influence on the European banking sector.
Well-received earnings reports from EasyJet (LON:EZJ) and Capita (LON:CPI) as well as a boost to UK bank stocks after Credit Suisse beat first quarter estimates saw the FTSE 100 break to the highest in four days. Standard Chartered (LON:STAN) and Barclays (LON:BARC) were amongst the top risers on the UK benchmark.
The improvement in Chinese inflation data is a better gauge on the global growth outlook than weakness in French and German industrial production, which unexpectedly fell in March thanks to a slowdown in the auto sector. China producer deflation slowing is a positive sign for China’s commodity-sensitive manufacturing economy, though probably doesn’t move the dial on the PBOC’s decision whether or not to ease monetary policy.
Canadian wildfires have been subsiding but the associated downdraft in oil prices appears to have moderated, helped by the possible supply impact of an outage in Nigeria. Equities and oil prices remain very interlinked, with both markets having topped in late April.
The British pound was firmer against the euro and the US dollar, brushing off data showing the biggest trade deficit since the first quarter of 2008.
US stocks look set for a higher open. Having held above the April lows in the recent sell-off, the Dow Jones is picking up steam to the upside, eyeing a triple digit gain on Tuesday. Drug-maker Allergan (NYSE:AGN) reports before the open for the first time since its failed takeover by Pfizer (NYSE:PFE).
USA pre-opening levels
S&P 500: 13 points higher at 2,071
Dow Jones: 114 points higher at 17,819
Nasdaq 100: 24 points higher at 4,365
DISCLAIMER: CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed.
No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.