Yahoo FinanceStocks Rise as Traders Await Inflation Cues: Markets Wrap

(Bloomberg) -- Global stocks edged higher and the dollar retreated on expectations that a key US inflation gauge will confirm easing price pressures, potentially enabling the Federal Reserve to cut interest rates in the coming months.
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The pan-European Stoxx 600 Index gained 0.4%, led by auto shares which benefited from news that China and the European Union have agreed to start talks on the bloc’s plan to slap tariffs on electric vehicle imports. S&P 500 futures advanced by about 0.2%, while Nasdaq 100 contracts were flat, pressured by a 3% fall in artificial-intelligence powerhouse Nvidia Corp.
Nvidia was set to extend losses for a third consecutive session, poised to wipe out another $70 billion in market capitalization. Meanwhile, Eurofins Scientific SE plunged as much as 24% in Paris after the laboratory-testing company was targeted by Carson Block’s Muddy Waters Research.
Markets are heading into a period filled with political risks, with the first voting round of the French parliamentary election on Sunday and polls showing gains for the far-right National Rally. Tuesday will bring the first US presidential debate between Joe Biden and Republican challenger Donald Trump
However, signs of firm economic growth continue to support global stocks, while Friday’s release of US core PCE — the Fed’s preferred gauge of consumer costs — is expected to show price pressures continuing to ease. That could pave the way for the Fed to begin lowering interest rates by September. Currently, markets see a 65% chance of a September rate cut.
“The expectation is we will see confirmation that inflation has slowed and that’s a development the Fed should welcome. If we get more soft inflation prints, they could well signal over the summer they will cut rates in September,” said Lee Hardman, a strategist at MUFG Bank Ltd.
Meanwhile, Bloomberg’s dollar index eased about 0.2%, having enjoyed a five-week rally. The other notable currency mover was the yen, which saw sharp moves around the 160 mark as Vice Finance Minister Masato Kanda said authorities are ready to intervene to support it 24 hours a day, if needed.
Elsewhere, Broadcom Inc. rose after Reuters reported the semiconductor device maker is working with ByteDance on developing an advanced AI processor. Micron Technology Inc. rose ahead of its earnings report due Wednesday.