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Highlights
Wall Street climbs even as the US economy records a sharper contraction
FTSE 100 and European indices rise amid geopolitical calm
Bank of England flags moderation in UK economic momentum
Stocks on Wall Street ended higher, with key benchmarks including the NASDAQ Composite, Dow Jones Industrial Average, and S&P 500 moving up, despite the US economy shrinking more than previously estimated for the first quarter. Data from the Bureau for Labour Statistics indicated that overall economic activity declined further than initial assessments.
The revised figures showed a broader slowdown in business activity during the quarter spanning January to March. This was attributed to slower consumer spending and reduced business investment across key sectors. The figures also reflected weaker inventory accumulation and downward adjustments to exports.
FTSE 100 Climbs on Ceasefire Optimism
The FTSE 100 recorded gains alongside other European indices following positive developments in geopolitical tensions. A ceasefire agreement between Iran and Israel helped ease concerns around further escalation in the Middle East, a region central to global energy markets.
Statements from US officials hinted at upcoming diplomatic engagement with Iran, aimed at maintaining regional stability. The ceasefire comes after nearly two weeks of hostilities that had raised concerns about potential disruptions in global oil supplies. Energy-related equities and sectors saw renewed interest following the de-escalation, supporting the performance of both UK and continental European markets.
European Equities Rise Despite UK Growth Warnings
The FTSE 350 and other broad-based European indices moved higher, as market sentiment absorbed the Bank of England's cautious commentary on economic momentum.
Bank of England governor Andrew Bailey, speaking at a recent industry event, highlighted that UK economic growth might slow in the near term. The initial strength seen earlier in the year, he noted, was influenced by transitory effects including pre-emptive buying before tax adjustments and increased trade activities ahead of new tariffs.
He further added that April saw a dip in GDP, aligning with expectations of a more tempered pace of activity. Sectors tied to housing and automotive transactions were among those contributing to the early-year boost, which may not persist in subsequent months.
Asian Markets Mixed as Global Growth Outlook Shifts
Major indices in Asia presented a mixed picture. The Nikkei 225 moved upward, driven by technology and industrial stocks, while the Shanghai Composite Index and the Hang Seng Index saw declines as investors assessed the impact of moderating global demand.
Market participants in the region remained focused on both local economic signals and the implications of slowing activity in the US and Europe. Currency movements and trade policy developments continued to play a key role in influencing sentiment across Asian equities.
