You are here

Global stocks mostly rise as markets shrug off weak data

By AFP - May 16,2020 - Last updated at May 16,2020

A Wall St. sign near the New York Stock Exchange is seen on May 8, in New York City (AFP photo)

NEW YORK — Global stocks were mostly firm on Friday as investors shrugged off weak economic data from Germany and the United States and focused on the easing of lockdowns rather than on fears of another coronavirus wave.

      Equity investors in Europe went fishing for bargains a day after stocks tanked on news of spiking jobless claims in the United States.

      "After two down days for the markets, the week is ending on a more positive note for equities," said AJ Bell investment director Russ Mould.

      The German economy shrank by 2.2 per cent in the first quarter of 2020, federal statistics agency Destatis said, calling the quarter-on-quarter decline "the worst since the global financial crisis" in 2009.

      The agency also revised its gross domestic product figure for the final quarter of 2019 from zero growth to a contraction of 0.1 per cent. That means Germany has experienced two consecutive quarters of decline, meeting the technical definition of a recession.

      In spite of that, the DAX 30 finished up 1.2 per cent, with analysts viewing Germany as better situated than other eurozone members.

      The downturn "was significantly smaller than the average for the eurozone and less than half the impact seen in the countries that saw the harshest lockdowns such as France and Spain," Oxford Economics said in a note.

      On Wall Street, stocks were initially pressured following weak retail sales data and US actions against Chinese telecom giant Huawei that escalated Washington's tensions with Beijing.

      But the Federal Reserve's muscular response to the coronavirus crisis has reassured equity investors, said Gregori Volokhine of Meeschaert Financial Services.

      These programmes include vehicles to purchase corporate debt, which means "solvent borrowers have a backup and that lifts their shares," he said.

      In one bright spot for the US, the University of Michigan monthly survey showed consumer sentiment improved slightly in May, ticking up to 73.7 per cent from 71.8 per cent in April.

      But Oxford Economics warned the bounce was "fragile," according to a note Friday. 

      "Whether it can be sustained will depend in part on whether the government enacts further stimulus measures to help households and whether the relaxation of restrictions results in a resurgence in COVID-19 infections," the note said. 


19 users have voted.

Add new comment

This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.
6 + 2 =
Solve this simple math problem and enter the result. E.g. for 1+3, enter 4.


Get top stories and blog posts emailed to you each day.