European stocks rise after Wall Street rebound

European shares rose on Friday, as traders balanced more evidence of a slowdown in China’s economy with hopes that red-hot U.S. inflation was easing after a rally on Wall Street that suffered overnight losses.

Europe’s Stoxx 600 was up 0.6% in early trade, while London’s FTSE 100 edged up 0.1% and Germany’s Xetra Dax gained 0.5%.

S&P 500 futures fell 0.2% after U.S. blue chips rose sharply in the previous session. Profits at Chinese industrial companies fell at the fastest pace in two years in April, official data showed on Friday. 8.5% From a year ago, in response to strict coronavirus lockdowns and high raw material prices.

Later on Friday, economists expected data to show that the growth rate of the U.S. core personal consumption expenditures price index, an inflation measure favored by the Fed that strips out volatile food and energy costs, began to decline. Analysts polled by FactSet forecast the core PCE index rose 4.9% in April from a year earlier, down from 5.2% in March.

Earlier this week, minutes from the Fed’s latest meeting showed the central bank would raise key interest rates by half a percentage point in June and July, despite policymakers pay attention Destroy the recovery of the job market.

Strong results from U.S. retailers Macys and Dollar Tree on Thursday boosted market sentiment The situation has been sharply bearish in recent days after warnings about inflation and macroeconomic conditions from consumer-facing businesses from Walmart to social media group Snap.

The S&P 500 rose 2% on Thursday, putting the blue-chip index firmly on track to avoid an eighth straight weekly decline, which would be the longest losing streak since 2001.

“The stock market is likely to be oversold in the short-term after falling sharply in recent weeks, thus suggesting a rebound is on the horizon,” said Lara Mohtadi, analyst at Nordea Bank SEB.

JPMorgan’s equity strategists added, “Investor sentiment has been very negative and portfolios are in a defensive position . . . the outcome of a recession.”

In Asia, Hong Kong’s Hang Seng climbed 2.1 percent after Alibaba beat first-quarter earnings estimates.Shares of e-commerce group soar 11% in Hong Kong transactions.

The U.S. dollar index, which tracks the greenback against six other currencies, was down 0.1% and was on track for a weekly loss of 1.3% after hitting a 20-year high earlier this month.

In the bond market, the U.S. 10-year yield fell 0.01 percentage point to 2.75%, as the price of the safe-haven asset held firm after a recent rebound. The yield on German equivalent foreign debt also fell to 0.98%.

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