European shares rally ahead of expected ECB rate cut and positive economic data

From Investing.com: 2024-06-03 05:06:01

European stocks and government bond yields saw a boost on Monday ahead of an expected ECB interest rate cut, with U.S. jobs data influencing focus on inflation. China’s factory activity growth in May strengthened optimism, while investors await the ECB decision, Bank of Canada meeting, and U.S. Fed action projections. Asian markets also exhibited strength.

The ECB is anticipated to lower rates by a quarter point to 3.75%, making it the first major bank to do so this cycle. Markets predict a modest easing cycle with only two 25-basis point cuts and a slim chance of a third. The Bank of Canada may also cut rates, with analysts suggesting deeper cuts. Investors are less dovish on the Fed.

Currency markets witnessed the dollar opening June higher against a basket of peers. The yen slightly increased against the dollar, while Asian stocks gained momentum following positive data. Gold prices remained steady, supported by central bank and Chinese buying. Oil prices fluctuated post OPEC+ agreement on production cuts extension.



Read more at Investing.com: European shares rally, eyeing ECB rates move By Reuters