Global stocks scaled new all-time highs on Thursday, spurred by a double whammy of robust economic data and lingering confidence in the Trump administration’s promises to cut taxes and roll back regulation.
The MSCI's All Country World index, a common benchmark which spans 46 countries, hit its highest level ever according to Reuters, after major indices on Wall Street already scored fresh records on Wednesday night, despite stocks across Europe inching lower.
“Across the broad landscape, global data has been looking really impressive and a lot of indicators have been looking really strong,” Nandini Ramakrishnan, a global market strategist at JP Morgan Asset Management told The Independent.
She said that purchasing manager indices across many countries had shown particularly strong readings in recent weeks, which was encouraging investors to snap up stocks.
Figures showing a fall in unemployment across much of Europe, combined with strong US retail sales and inflation data on Wednesday, supported sentiment.
Earlier this week US Federal Reserve Chairwoman Janet Yellen struck an upbeat tone when she signalled that the central bank could raise interest rates as early as March, if the economy remains on track and key inflation and labour targets are met.
According to official data published at the beginning of February, total US non-farm payrolls rose by 227,000 in January, much higher than the 175,000 expected by economists.
Another driver behind the recent rally in stock markets has been President Donald Trump’s pledge to roll back regulation and reform taxes to bolster economic growth and job creation.
Bank stocks have responded particularly optimistically to his rhetoric and shares in Goldman Sachs this week hit a ten-year closing high.
Last week Mr Trump said that he was on the verge of announcing the most ambitious tax reform since the Reagan era.
He promised a “phenomenal” tax plan that will slash corporate levies, possibly encouraging global corporations to repatriate large sums of money held in offshore accounts.
On Thursday Mr Trump tweeted: “Stock market hits new high with longest winning streak in decades. Great level of confidence and optimism - even before tax plan rollout!”
