Micron's stellar results, revealed after Wednesday's close, fueled gains across the entire subsector, but a higher-than-expected inflation reading (PCE: 4.1% YoY in May, the highest since April 2023) reminded markets that the Fed's rate hike outlook remains relevant. Broad European indices were dominated by optimism, translating into gains.
The German DAX rose 1.05%, the UK FTSE 100 gained 0.65%, and France's CAC 40 finished the day 0.55% higher. Buying pressure was also evident in Zurich (SMI: +0.81%), Madrid (IBEX 35: +0.64%) and the pan-European STOXX Europe 600, which gained 0.80%.
The Warsaw exchange recovered part of Wednesday's losses on Thursday. The biggest winner of yesterday's battles was the domestic blue‑chip index WIG20, which closed 1.26% higher after a strong opening. Energy, fuel and retail stocks were key contributors. The broad market index WIG, characterized by a twin‑track session, finished the day 0.95% higher.
Against the largest players, the second and third tiers of companies performed noticeably worse. Investors showed indecision, and the mWIG40 and sWIG80 indices posted +0.25% and -0.17% respectively.
Enter Air was heavily discounted (-7.02%) after Ipopema Securities ABB announced a package of shares belonging to Enter Investments.
Rise in semiconductor companies
Demand also dominated the bond market. The yield on benchmark 10‑year bonds fell 5 basis points to 5.361%. Although sentiment was mixed, pessimism prevailed. Semiconductor firms strengthened: note Micron (+15.84%), whose market cap surpassed Meta Platforms, and SanDisk (+21.97%).
The Dow Jones Industrial Average ended the session 0.14% higher, the S&P 500 remained near its reference level, while the Nasdaq Composite fell 0.46%. Software companies and the Magnificent Seven group faced strong supply pressure. Apple took the front page with its decision to raise Mac and iPad prices, linked to global chip pricing.
Small‑cap companies performed best, clustered in the Russell 2000, which strengthened 0.71%. Morning views of Asian markets paint a pessimistic picture, with the vast majority of indices below the line. After a strong Thursday session, Japanese investors are reducing risk in their portfolios (Nikkei 225: -4.42%).
South Korea sell‑off
The sell‑off continues in South Korea, where after a sharp decline early in the day KOSPI fell 7.08%. Declines are also seen in China: Hang Seng drops 1.82% and Shanghai Composite 1.88%. Investors in India are not participating in today's market struggles due to the Muharram holiday.
Morning also brings a continuation of oil price declines – the Brent contract trades below $75 per barrel. Investors are also reducing positions in precious metals: gold (XAU: -0.45%) and silver (XAG: -2.32%).
The futures market in Europe and the United States is in the red, indicating a potentially weak opening for Friday's session.
