As New Wave of Tech Momentum Develops, Stocks Rise – Europe Market Wrap
The latest surge of enthusiasm for tech stocks continued into Friday, boosting US stock futures. Small caps also rose as investors increased their exposure.
Nasdaq 100 contracts increased 0.5%, outperforming those of the S&P 500. The rise occurred as a barometer of Asian tech stocks reached an all-time high, following a new high for a US chipmaker index the previous session. The trend was also noticeable in premarket activity, with Micron. and AMD surging by more than 2%.
The first full week of the latest earnings season is looking promising, with 89% of the 28 businesses that have reported exceeding forecasts. With huge banks dominating the early days, investors will get a sharper picture of the broader economy next week when Netflix, Johnson & Johnson, and 3M report earnings.
Meanwhile, yield premiums on corporate paper have fallen to their lowest levels since 2007, according to an index of bonds across currencies and ratings, prompting some of the world’s largest money managers to caution against complacency. The extra yield that investors seek from holding junk notes has likewise plunged to its lowest level in over two decades.
Small caps extended their gains, with Russell 2000 futures up 0.3%. So far this year, the index has surged 7.8%, while the main US benchmark has advanced less than 1.5%. Oil recovered from its biggest drop since June, but gold and silver fell. The Dollar declined 0.1%, as US Treasuries showed no change.
