European stock markets saw gains on Wednesday, boosted by a rebound in Nvidia shares and a broadly positive risk sentiment ahead of the French legislative election. The pan-European STOXX 600 climbed 0.5%, reaching its highest level since June 13. France’s CAC 40 increased by 0.4%, Germany’s DAX rose 0.9%, and Britain’s FTSE 100 gained 0.6%. Investors’ focus remained on the European Central Bank’s monetary policy outlook, anticipating further interest rate cuts to bolster corporate earnings.
ECB policymakers and market traders are expecting around 45 basis points of further easing from the ECB this year, following a recent 25 bps cut. ECB policymaker Ollie Rehn supported the market’s expectations, calling them “reasonable.” In the U.S., Federal Reserve officials urged patience regarding interest rate cuts, with Governor Lisa Cook indicating potential cuts if economic performance aligns with expectations. Fed Governor Michelle Bowman reiterated that holding the policy rate steady for some time would likely suffice to control inflation.
Globally, U.S. equity futures edged higher, and MSCI’s Asia-Pacific shares index, excluding Japan, neared a two-year high. Japan’s Nikkei and Taiwan’s stocks rose, led by chipmakers, tracking the tech-heavy Nasdaq’s rally. Markets are closely watching the upcoming U.S. personal consumption expenditures price index release on Friday, with economists predicting a slowdown in annual growth to 2.6% in May.
Source: Reuters