On 05 October, 2015 – European markets rallied as mining and resource stocks advanced

Stocks rallied globally on expectations that the Federal Reserve will not increase interest rates in 2015.
United States
Market advanced Monday after a disappointing jobs report on Friday led investors to expect that the Federal Reserve will postpone its first interest rate increase. Energy stocks rose along with the price of oil. Both the Dow Jones industrials and S&P gained 1.8% while the Nasdaq advanced 1.6%.
General Electric shares advanced after activist investor Nelson Peltz disclosed he had accumulated a US$2.5 billion stake in GE. Mr. Peltz is likely to put more pressure on GE’s chief executive, Jeffrey Immelt, to raise the company’s stock price, which has lingered around US$25 to US$26 for the last two years. Shares of Alphabet, the new parent company of Google, gained. Google announced this year that it would reorganize. Alphabet will be the parent company, with Google being the largest subsidiary within Alphabet. This would allow investors to see how well Google’s core business is doing, separate from its more experimental ventures like driverless cars. Monday was the first day the company started trading as Alphabet. Twitter was up after the company said it was moving its co-founder Jack Dorsey into the chief executive position full time. Dorsey had been interim CEO since June.
The United States and 11 other Pacific Rim nations agreed to the largest regional trade accord in history, a potentially precedent-setting model for global commerce and worker standards that would tie together 40% of the world’s economy, from Canada and Chile to Japan and Australia. The Pacific accord would phase out thousands of import tariffs as well as other barriers to international trade. It also would establish uniform rules on corporations’ intellectual property, open the Internet even in communist Vietnam and crack down on wildlife trafficking and environmental abuses.
Gold at the afternoon London fixing slipped US$1.00 to US$1,139.75. Copper futures were up 1.4% to US$2.36. WTI spot crude was up 85 US cents to US$46.39. Dated Brent spot crude was up US$1.28 to US$49.41. The US dollar was up against the euro, yen, pound and the Swiss franc. However, it declined against the Canadian and Australian dollars. The Dollar Index was up 0.4%. The yield on US Treasury 30 year bond was up 7 basis points to 2.90% while the yield on the 10 year note added 7 basis points to 2.90%.
Europe
Stocks rallied Monday. Although markets rebounded somewhat on Friday after the release of the weak US employment report, they did not have the opportunity to participate in the snap back rally that continued in the United States after markets closed for the week. The FTSE added 2.8%, the CAC jumped 3.5%, the DAX gained 2.7% and the SMI was 2.6% higher. The Chinese market remained closed to celebrate the National Day festival.
Mining and resource stocks advanced on rising commodity prices and rumors regarding Glencore. Energy stocks also turned in a solid performance thanks to rising crude oil prices. Financial and luxury goods companies were also among the gainers. K+S plunged after Canadian fertilizer giant Potash Corp. of Saskatchewan withdrew its proposal to acquire the company. Potash cited challenging macroeconomic conditions and a lack of engagement by K+S’s management. Volkswagen advanced after the car maker suspended the sale of some of its diesel vehicles in Australia to address the emissions issue.
Deutsche Bank climbed on a broker upgrade. Commerzbank also finished higher. RWE and E.ON advanced. In Paris, both Technip and Total advanced. Kering and LVMH closed higher. In London, Glencore surged on reports that it is talking to potential buyers for its agriculture business. Other miners including Antofagasta, Anglo American, BHP Billiton, Fresnillo, Rio Tinto and Randgold Resources climbed. Lloyds Banking Group increased after the UK government said it intends to fully exit from its Lloyds shareholding in the coming months and as part of this at least £2 billion of shares will be sold to retail investors. Rolls-Royce gained after it announced to cut up to 400 jobs from its Marine division. Nestle advanced after it said that it and R&R, a leading European ice cream company based in the UK, are in advanced discussions to set up a new joint venture covering ice cream based mainly in Europe and Africa.
Eurozone private sector growth slowed more than initially estimated to a four-month low in September according to the composite PMI. The final reading was 53.6 in September, down from 54.3 in August. British service sector growth unexpectedly slowed for a third consecutive month in September to its lowest level in nearly two-and-a-half years, hurt by a slump in new business growth, signaling that economic performance was soft at the end of the third quarter. The services PMI slid to 53.3 from 55.6 in August.
Asia Pacific
Shares advanced across the board on Monday as higher commodity prices on the back of diminished rate increase expectations helped revive investors’ appetite for risk. Only 142,000 jobs were added last month in the US, well below economist estimates, dampening expectations that the Federal Reserve would raise interest rates this year. Mainland Chinese markets were closed to celebrate the National Day festival. The Hang Seng index gained 1.6% to finish on expectations that Beijing would strengthen fiscal policy and boost infrastructure spending to support growth.
The Nikkei hit a two-week high with the prospects of a delay in US rate increases and signs of progress in Trans-Pacific Partnership negotiations boosting investor sentiment. The dollar was marginally higher against the yen on expectations the Bank of Japan will expand its stimulus program. The Nikkei was up 1.6% — the highest level since September 18. Fujitsu, Kawasaki Industries, Mitsubishi Chemical Holdings, Mitsubishi Corp and Japan Steel gained as did Fast Retailing, Fanuc, Softbank, Inpex and JX Holdings. Mazda Motor was up on hopes that a free trade agreement being negotiated between several countries would give Japan’s automakers a freer hand to source parts from Asia.
Australian shares also hit a two-week high as mostly positive economic data as well as higher gold and metal prices boosted investor confidence in the economy. Both the S&P/ASX and All Ordinaries gained 1.9%. Miners and the four big banks all advanced. Australia’s services sector expanded for the fourth consecutive month in September, marking its longest period of continuous growth since March 2008. The Kospi added 0.4%. The Sensex added 2.2% as unexpectedly weak US jobs data, downward revisions to the prior two months and disappointing factory orders figures helped push back expectations for an interest rate increase into next year.
Global Stock Market Recap

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*
The Reserve Bank of Australia announces its monetary policy decision. India posts its services PMI index for September. Germany releases August manufacturing orders. The US and Canada report August international trade.
*Note — all releases are listed in local time.