NEW YORK (Reuters) - Equity markets around the world neared a six-month high on Tuesday, buoyed by a rebound in Chinese stocks and an earnings-driven surge on Wall Street, while oil prices rose on concerns U.S. sanctions against Iran could cause supply shortages.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., July 24, 2018. REUTERS/Brendan McDermid/File Photo
The equity gains prompted investors to sell safe-haven assets before the first leg of this week’s $78 billion quarterly U.S. government refunding, pushing Treasury yields higher.
The dollar weakened against the euro on a more stable Chinese yuan after the currency pair neared but failed to break through technical levels supporting the single currency.
U.S. corporate revenues are growing at a time the European and Japanese central banks continue to prop up their economies, which is suppressing shorter-term interest rates, said Michael Kelly, global head of multi-asset at PineBridge Investments.
“Profits are incredible, actually, and it’s not just tax-cut sugar highs,” Kelly said.
Of the 428 companies in the S&P 500 that have released second-quarter earnings so far, 79 percent reported above analyst expectations, a beat rate that if it holds will be the highest since Thomson Reuters started reporting the figure in 1994.
Earnings per share without the tax change would be 15.5 percent higher, leading to upward revisions for the rest of the year, according to Credit Suisse.
MSCI's all-country world index of stock markets in 47 countries .MIWD00000PUS gained 0.46 percent, while the pan-European FTSEurofirst 300 index .FTEU3 of leading regional shares closed up 0.54 percent.
On Wall Street, the Dow Jones Industrial Average .DJI closed up 126.73 points, or 0.5 percent, to 25,628.91. The S&P 500 .SPX
