The prospect of a quarter-point rise in key US interest rates can usually be relied upon to pile pressure on financial markets. Yet so widely expected was yesterday’s move, at the conclusion of a two-day Federal Reserve rate-setting meeting, that world stocks pushed higher unhindered on Tuesday. By the close, the Dow Jones Industrial Average had tacked on 0.6 per cent to 10,551.94. The Nasdaq Composite gained 0.3 per cent.
European bourses were modestly higher by midday but trade was cautious ahead of the US interest rate decision this evening by the Federal Reserve. The FTSE Eurofirst 300 rose 0.2 per cent to 1,072.23 with the CAC-40 in Paris up 0.2 per cent to 3,947.54, the Frankfurt Xetra Dax rose 0.3 per cent to 4,293.34.
Having breached the 4,900 level by the close on Tuesday, the FTSE edged higher by mid-morning yesterday, helped by strength in the pharmaceuticals and mining sectors. The FTSE 100 in London 0.1 per cent higher at 4,913.
Fiat was the worst faller on the Eurofirst 300, down 4.6 per cent to e5.91 after the Italian car maker failed to reach an agreement with General Motors regarding the cancellation of the company’s right to sell its troubled car unit to the US company.
Roche fell 3.6 per cent to SFr122.50 after the world’s biggest maker of cancer treatments saw group sales, in local currencies, rise 12 per cent, slightly less than analysts forecast, to SFr29.52bn, while prescription drug sales were up 13 per cent at SFr21.70bn. Analysts polled by Reuters had on average expected group sales of SFr30.18bn and drug sales of SFr22.14bn. Core profits rose 41 per cent to SFr4.34bn. Overall the drugs sector was the biggest positive pull, with AstraZeneca 2 per cent higher at £20.67 and Schering 0.3 per cent to the good at e51.68.
Tokyo shares closed at a two-week high yesterday, as investors hunted for bargains following Tuesday’s sell-off. The benchmark Nikkei 225 average was up 0.2 per cent to 11,407.14, while the broader Topix index was up 0.5 per cent to 1,151.97.
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