London (AFP) – The dollar extended its gains on Thursday as strong US growth and jobs data helped traders move past North Korea’s missile test, while oil rebounded slightly as deadly storm Harvey batters the Gulf Coast.
Stock markets were also up.
“Equities remain in rebound mode, extending their bounces as relative geopolitical calm and positive macro data” in China, the United States and the eurozone “fuels fresh risk taking by investors,” said Mike van Dulken, head of research at Accendo Markets.
But one notable heavy loss among individual companies was French supermarket giant Carrefour.
Its share price dived nearly 13 percent to stand at 17.04 euros in Paris by mid-afternoon after the group published disappointing results for the first half and warned of a drop in earnings for the whole year.
Investors in Europe also reacted to news that eurozone inflation rose closer to the European Central Bank’s 2.0-percent target in August.
The fresh data will reinforce hopes that, despite uncertainty and the unknowns of Brexit, the eurozone is emerging from the worst of the financial crisis that began in 2008.
“The greenback still seems to be benefiting from yesterday’s better than forecast second-quarter GDP reading,” said Spreadex analyst Connor Campbell.
The US Commerce Department reported Wednesday the world’s largest economy expanded a forecast-beating three percent in the second quarter.
“The dollar rose 0.4 percent against the pound, forcing it below $1.29, and 0.3 percent against the euro, leaving the currency under $1.19 despite a jump in eurozone inflation.”
The dollar rallied against the euro and yen — considered a safe bet in times of crisis — as the data revived speculation that the Federal Reserve could consider lifting US interest rates for a third time this year.
Eyes will now turn to the release of more jobs figures on Friday, after a closely watched private jobs creation reading that came out on Wednesday also exceeded market expectations.
“Of course, Friday’s jobs report is widely regarding as the most important data release each month due to the insight it offers on hiring, wages and therefore potential future inflation pressures,” said Craig Erlam at OANDA.
Inflation data that came out Thursday showed only a token increase in July, which could add to disagreements among Fed officials who are split over the need to raise the key interest rate a third time this year.
Wall Street stocks opened higher, with the Dow adding 0.2 percent.
“US stocks are…