The macro picture is far from crystal clear, however.
Data released on Friday showed Britain’s first-quarter economic growth bounced back stronger than many had expected and the Atlanta Fed’s closely-watched U.S. real-time GDP estimate is tracking growth back above 4% – despite economic surprise indexes at their most negative in more than a year.
But if disinflation does resume, the punchy growth signals and above-forecast first-quarter earnings season may well provide the perfect backdrop for stock markets. The critical U.S. consumer price inflation report is due next week.
Elsewhere, Asia bourses were also buoyed by the global picture. Hong Kong’s Hang Seng surged more than 2% to 9-month highs and is now tracking year-to-date gains of 11% – ahead of equivalent gains in the S&P500.
Bloomberg News reported China is considering a proposal to exempt individual investors from paying dividend taxes on Hong Kong stocks bought via the Stock Connect system.
Mainland Chinese shares were more subdued despite this week’s upbeat April trade numbers, with deteriorating bilateral relations with Washington proving a drag.
U.S. President Joe Biden’s administration on Thursday added 37 Chinese entities to a trade restriction list, including some for allegedly supporting the spy balloon that flew over the United States last year.
And Biden is also set to announce new China tariffs as soon as next week targeting strategic sectors, including electric vehicles, a source told Reuters.
What’s more, the proportion of European firms that rank China as a top investment destination has hit a record low, a European business lobby group said on Friday.
