📆 Friday, February 21
► European markets edged higher on Friday as investors assessed flash PMI data and corporate earnings while awaiting key German elections this weekend. The Stoxx 600 rose 0.3%, supported by gains in Standard Chartered (+4.0%) after announcing a $1.5B share buyback, and Italian aerospace / defence company Leonardo (+1.8%), which posted better-than-expected results. Germany’s DAX inched up 0.1%, as service sector growth offset weakness in manufacturing, while France’s CAC 40 climbed 0.3%, despite the sharpest decline in economic activity since September 2023 showing the French economy is lagging. The EUR fell against the USD after France’s weak PMI data, the gap between US yields and European bond yields increased, while Germany’s upcoming election results remain a key focus.
► US stock futures are little changed following Thursday’s decline, which was fueled by Walmart’s weak outlook and rising concerns about economic growth. S&P 500 futures are flat (+ 0.1%), while Nasdaq 100 (+0.3%) is little changed. Treasury yields dipped slightly (1 – 2 bps), with the 10-year yield at 4.49%, despite Fed minutes signaling caution on rate cuts. Investors are also watching PMI data and existing home sales for further insights into the US economy. Meanwhile, Treasury Secretary Scott Bessent hinted at possible sanctions relief for Russia in negotiations to end the Ukraine war, a move that could impact global energy markets.
► Asian markets saw mixed performance, but Chinese tech stocks surged following Alibaba’s strong earnings report. Hong Kong’s Hang Seng jumped 3.99%, its biggest gain in over three years, driven by a 9% rally in Alibaba shares, which reported its strongest revenue growth in over a year. China’s Shanghai Composite gained 0.85%, while Japan’s Nikkei rose 0.28%, despite inflation data surpassing expectations. Australia’s ASX 200 dropped 0.32%, with losses in mining and banking stocks following disappointing earnings reports.
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