London, Feb 6 (Reuters) - European shares reached a new high, gold neared one of its record peaks, and bond markets faced renewed pressure on Thursday. The market focus turned to the direction of global interest rates and tech stock performance after days of concerns over trade wars.
The pound depreciated following a quarter-point cut by the Bank of England, yet Europe’s shares remained strong, boosted by positive news from drugmaker AstraZeneca and miners, helping the STOXX 600 index gain 0.7%.
Wall Street appeared less optimistic, with S&P 500 and Nasdaq futures showing minimal movement. Later, Amazon's earnings were expected, with high hopes for its cloud computing segment after disappointing reports earlier in the week.
Ahead of the all-important January nonfarm payrolls report on Friday, a weekly jobless claims report was scheduled for release before markets opened.
Regarding the Bank of England's recent actions, Craig Inches, head of rates and cash at Royal London, noted a shift in market sentiment towards concerns about global growth. The markets had readjusted expectations for UK rates to a lower level of 3.75% from around 4.10% a month ago.
In response to weak business and consumer sentiment, the UK central bank halved its growth forecast for the year to 0.75%. Although projections for 2026 and 2027 saw slight improvements, Inch expressed interest in aligning market expectations with Andrew Bailey’s views.
In the face of uncertainties surrounding U.S. President Donald Trump’s policies on trade and economy, global markets, for the most part, seemed relieved that situations have not worsened significantly. China's monetary policy and responses to U.S. tariffs were also closely monitored by investors.
China's actions, such as maintaining a strong yuan value despite external pressures, were viewed as calming measures by market analysts. This stability contributed to a positive outlook, evidenced by a rise in the CSI300 blue-chip index.
Global government bond yields in Europe were on the rise after hitting one-month lows. Despite President Trump advocating for lower interest rates, U.S. Treasury Secretary Scott Bessent emphasized that the Federal Reserve’s independence would be respected.
Market expectations suggested a modest 45 basis points easing by the Fed by year-end. In currency markets, the dollar gained strength, while major currencies experienced fluctuations in response to central bank policies and economic factors.
Oil prices stabilized following concerns about softer economic growth due to a potential trade conflict between China and the U.S. Both U.S. crude and Brent crude saw slight increases after a previous decline.
Although gold dipped slightly from its recent peak, it maintained a strong position, closing at $2,860.11 per ounce.