DAX & Nasdaq Comp Hit Records, Ocado Promises Profits

Equities

In the UK, the FTSE 100 index saw a slight increase, closing up 0.1% thanks to a positive earnings season. This uplift came from standout performances by companies such as Haleon and Howden, which buoyed the index, setting it up for monthly gains. Haleon, known for its Sensodyne toothpaste, announced a share buyback plan after reporting firm demand for its products and progress in reducing debt, which saw its shares jump by 5.6%. Howden Joinery enjoyed a 7.0% share price gain following the company's optimistic revenue growth forecast for 2024.

Ocado also made headlines with its promise to achieve a pretax profit within five to six years, pushing its shares up by 4.2%. The more domestically focused FTSE 250 index edged up 0.2%, with Drax Group, the renewable electricity giant, seeing shares soar by 11.2% after it announced a 66% increase in annual profit and raised its dividend.

The S&P 500 and Nasdaq both closed at record highs, marking a significant rebound for Wall Street. This came after the US personal consumer expenditures (PCE) price index data, a key inflation gauge for the Federal Reserve, showed the smallest annual increase in nearly three years. This data, much anticipated by investors, suggested a potential rate cut by the Fed in June, igniting optimism. The S&P 500 rose by 0.52% to a record close, while the Nasdaq gained 0.90%, hitting a peak for the first time in more than two years.

The financial markets were also closely watching Bitcoin, which notched its sixth day of gains and marked its biggest monthly gain in over three years.

Forex & Commodities

The US dollar saw an increase in choppy trading, marking its second consecutive monthly gain against the euro and yen. This rise came after initial concerns were alleviated by US inflation data for January, which met expectations and maintained the possibility of a Federal Reserve rate cut in June. The euro fell following Germany inflation data, while the Japanese yen gained strength following comments from a Bank of Japan policymaker hinting at the end of ultra-easy monetary policies.

In the commodities market, gold prices remained close to a one-month high, supported by the latest US inflation data, which suggested easing price pressures. This has kept traders' attention on the potential for interest rate cuts later this year, which would increase the appeal of non-yielding bullion. Gold is on track for its second consecutive weekly gain, with spot gold prices showing a slight increase.

Oil prices also saw a modest uptick as the market awaited an OPEC+ decision on supply agreements for the second quarter.