Global Stocks Rally As Traders Brace For Busy Week: Markets Wrap

Stocks rose at the start of a week that is packed with events that will be crucial in shaping sentiment as markets trade near all-time highs. Gold extended a record rally.

S&P 500 futures climbed 0.2%, clawing back most of the losses incurred on fears that the Federal Reserve was falling behind in supporting a cooling jobs market. EchoStar Corp. jumped in early trade following a $17 billion deal with SpaceX’s Starlink for wireless spectrum. Longer-dated Treasuries eased while the dollar head for a back-to-back loss.

Europe’s Stoxx 600 gained 0.3%. The advance was fueled by energy stocks amid rising crude prices, while traders braced for a confidence vote that’s expected to topple French Prime Minister Francois Bayrou’s government. The region’s bonds were broadly steady.

Japanese equities advanced, buoyed by a weaker yen after Prime Minister Shigeru Ishiba announced that he will step down. The country’s long-dated bonds fell as uncertainty over Ishiba’s successor fueled concerns about spending.

Uncertainty in Japan and France adds to a torrent of US data this week that will help determine the Federal Reserve’s policy path. With a September interest-rate cut fully priced in, upcoming releases on consumer and producer prices will show how much room the Fed has to support the jobs market.

Michael Brown, a senior research strategist at Pepperstone Group Ltd., said investors will have to consider whether a cracking labor market could stall consumer spending, posing a headwind to equities.

“For the time being, though, oodles of AI CapEx from the hyperscalers, plus solid earnings growth, calmer tones prevailing on trade, and a more accommodative policy stance, should all keep the path of least resistance leading higher,” Brown wrote.

Among other events scheduled for the week, the European Central Bank is expected to hold rates steady on Thursday, though President Christine Lagarde’s remarks will be parsed for signals on her readiness to contain French turbulence.

“A combined measure of French risk spreads is off its recent highs, but remains near this year’s peak ahead of today’s confidence vote in Prime Minister Bayrou’s government. The fundamental problems of a hefty debt load, a large primary deficit and a sclerotic state incapable of reform aren’t likely to be fixed any time soon.”—Simon White, Macro Strategist. For the full analysis, click here.

On Tuesday, the Bureau of Labor Statistics will release its preliminary payroll benchmark revision for the year through March, with another downward adjustment likely to show the labor market was weakening well before the recent slowdown in jobs growth.

Thursday’s consumer-price data is projected to show that progress on reducing inflation has stalled as higher US import duties filter through the economy. Still, investors see Fed officials lowering rates at their upcoming meeting, with some even expecting a jumbo half-point cut.

“Our economists believe you’d need to see pretty weak inflation this week to get that,” wrote Jim Reid, global head of macro research and thematic strategy at Deutsche Bank AG. “Of course, the focus will very much be on the continued impact of the tariffs in core goods categories, and we know these are still filtering through.”

In commodities, oil gained after OPEC+ agreed on Sunday to raise production at a modest rate next month. Crude futures had slumped last week on signs the output boost was coming. Gold advanced above $3,600 an ounce.

• SpaceX, the Elon Musk-backed company that owns the Starlink satellite network, agreed to acquire wireless spectrum from Charlie Ergen’s EchoStar Corp. for about $17 billion in cash and stock.

• The US is proposing annual approvals for exports of chipmaking supplies to Samsung Electronics Co. and SK Hynix Inc.’s factories in China, a compromise aimed at preventing disruptions to the global electronics industry.

• South Korea’s biggest conglomerates are rushing to contain fallout from a sweeping US immigration raid at a Hyundai Motor Co.-LG Energy Solution Ltd. battery venture in Georgia.

• More than a year after BBVA SA unveiled its unsolicited takeover offer for Banco Sabadell SA, shareholders finally get their say.

• RWE AG and Apollo Global Management Inc. agreed to form a joint venture to invest in Germany’s power grid as the country seeks to ease network congestion in Europe’s biggest energy market.

Some of the main moves in markets:

Some of the main moves in markets:

Stocks

• S&P 500 futures rose 0.2% as of 7:06 a.m. New York time

• Nasdaq 100 futures rose 0.4%

• Futures on the Dow Jones Industrial Average rose 0.2%

• The Stoxx Europe 600 rose 0.3%

• The MSCI World Index was little changed

Currencies

• The Bloomberg Dollar Spot Index fell 0.1%

• The euro rose 0.1% to $1.1729

• The British pound rose 0.1% to $1.3528

• The Japanese yen fell 0.2% to 147.77 per dollar

Cryptocurrencies

• Bitcoin rose 0.5% to $111,920.92

• Ether rose 0.5% to $4,321.72

Bonds

• The yield on 10-year Treasuries advanced one basis point to 4.09%

• Germany’s 10-year yield was little changed at 2.66%

• Britain’s 10-year yield advanced one basis point to 4.66%

Commodities

• West Texas Intermediate crude rose 2% to $63.08 a barrel

• Spot gold rose 0.8% to $3,615.22 an ounce