SYDNEY- US and European stock futures rallied on Thursday on optimism over prospects of a peace deal between Ukraine and Russia, offsetting a jump in Treasury yields as higher inflation threatens to close the door to any policy easing this year.
Trade war jitters persisted as US President Donald Trump said he would impose reciprocal tariffs on Wednesday or Thursday on every country that charges duties on US imports. Gold prices climbed back towards the record reached on Tuesday.
The euro extended an overnight bounce, last up 0.5 percent in Asia to $1.0433, helped by Trump’s phone calls with Russian President Vladimir Putin and Ukraine’s Volodymyr Zelenskiy, which raised hopes that the years-long war could be nearing an end.
Oil prices fell for a second day, testing some key support levels, while EUROSTOXX 50 futures climbed 1 percent, pointing to a higher open for European markets.
Nasdaq futures rose 0.4 percent and S&P 500 futures gained 0.2 percent.
Japan’s Nikkei gained 1.4 percent thanks to a much weaker yen. MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.2 percent to the highest since early December.
“There were pretty significant moves like in the euro and European assets. The specter of war has definitely hung pretty heavy over the region,” said Kyle Rodda, a senior analyst at Capital.com.
“The optimism is probably somewhat premature.”
Chinese blue chips were 0.2 percent higher and Hong Kong’s Hang Seng index extended its bullish run, up 2.5 percent to another four-month high.
Overnight, data showed US consumer prices rose by the most in nearly 1-1/2 years in January. The closely watched core inflation index, which excludes food and energy prices, rose 0.4 percent in the month, above forecasts for 0.3 percent.
