Global stocks continued their recent rally overnight, with news from both sides of the Atlantic pointing to a resurgent global economy.
European stocks gained for a fourth session, extending a 10-week high, as companies posted better-than-estimated earnings and German investor confidence climbed.
The Stoxx 600 Index climbed 0.6% to 307.8 at the close of trading, the highest level since May 28. In London, the FTSE 100 added 38 points (+0.6%) to settle at 6612 while the German DAX put on 57 points (+0.7%) to close trading at 8416.
The ZEW Center for European Economic Research in Mannheim said its index of investor and analyst expectations, which aims to predict economic developments six months in advance, rose to 42 from 36.3 in July beating economists’ expectation of 39.9.
Across the Atlantic, U.S. stocks also advanced with the S&P 500 trimming morning losses for a ninth consecutive session, as data on retail sales reinforced signals the economy is expanding moderately.
The S&P 500 rose by five points (+0.3) to finish trading at 1694 while the Dow Jones added 31 points (+0.2%) to close the trading session at 15451.
A U.S. Commerce Department report showed that U.S. retail sales climbed 0.2% in July, following a 0.6% gain in June that was larger than previously reported.
In the commodity markets, crude oil advanced for a third session after U.S. retail sales gained and German investor confidence topped forecasts. Crude for September delivery rose 72 cents to settle at $106.83 a barrel on the New York Mercantile Exchange.
On the other hand, gold fell for the first time in a week as signs of gains in the U.S. economy boosted speculation that the Federal Reserve will scale back monetary stimulus, while the greenback’s rally eroded the appeal of the metal. Bullion futures for December delivery fell 1% to settle at $1,320.50 an ounce on the Comex in New York.
In local economic news, the Australian Bureau of Statistics will release its quarterly Wage Price Index today at 11:30 am.