Global stocks edged higher on Thursday, as investors waited for new cues as they consider growing signs of economic recovery against rising coronavirus cases in some parts of the world.

The European composite Stoxx 600 rallied 0.4 per cent in early trading, while the UK’s FTSE 100 wavered close to flat. Germany’s Dax rose 1 per cent as data showed exports from Europe’s largest manufacturing economy had begun to recover in May.

In the US, S&P 500 futures edged lower ahead of new unemployment numbers due later on Thursday, after another record daily rise in Covid-19 cases in the US on Wednesday.

Paul Donovan, chief economist at UBS Global Wealth Management, said fear over the virus had risen in the US recently.

“Initial jobless claims data today gives some hint as to whether recent fear has had a significant economic impact,” he said.

Chinese markets outperformed in Asia once again. Mainland China’s CSI 300 of Shanghai and Shenzhen-listed stocks rose 1.1 per cent on Thursday, taking its gains from this week’s rally to about 8 per cent. Hong Kong’s Hang Seng index erased earlier gains after local media reported an increase in new Covid-19 cases, raising fears of another wave.

The positive sentiment came after official data from China showed that factory gate deflation eased during June, with prices falling 3 per cent year-on-year compared with expectations of a 3.2 per cent decline. Consumer prices rose by 2.5 per cent year-on-year during the month, in line with a poll of economists by Bloomberg.

“With fiscal stimulus and infrastructure spending still ramping up, we think that economic activity and producer prices are set to recover further in the coming months,” said Martin Rasmussen, China economist at Capital Economics.

However, other analysts cautioned that a surging stock market may prompt policymakers to think twice before unleashing further stimulus measures such as cuts in the amount of reserves banks are required to hold.

“Although Beijing needs booming stock markets to boost confidence and channel capital to the business sector, it may also be concerned that an unbridled stock market boom followed by a bust could sabotage its efforts to return the economy to normal,” said Ting Lu, Nomura’s chief China economist.

China’s onshore-traded renminbi strengthened 0.2 per cent and passed the important seven to the dollar marker for the first time since March, reaching 6.9910 to the greenback. The dollar index, which measures the value of the US currency against a basket of global peers, fell 0.1 per cent.

Overnight on Wall Street, the S&P 500 closed 0.8 per cent higher following a final hour rally while the tech-heavy Nasdaq Composite added 1.4 per cent. That was despite concerns over a resurgence in Covid-19 cases in several US states, including Texas, Florida and California.

Commodity prices were little changed. Brent, the international crude oil benchmark, was flat at $43.27 per barrel and West Texas Intermediate, the US marker, slipped 0.3 per cent to $40.78 per barrel. Data from the Energy Information Administration overnight showed that US crude stockpiles nudged higher to 539m barrels in the week to July 3.

Gold, the haven asset that hit a nine-year high on Wednesday, was unchanged at $1,820.20 per troy ounce.

The yield on US 10-year Treasuries, also viewed by investors as a haven during times of uncertainty, slipped 0.01 percentage point to 0.651 per cent. Bond prices rise as yields fall.

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