Tech gains, Korea boosts world stocks

STERLING AT LOWEST SINCE MARCH 9 AS BRITAIN’S ECONOMY SLOWS

World stocks rose yesterday, lifted by strong share price gains for tech giants such as Amazon and Facebook and growing hopes of a lasting peace on the Korean peninsula after a ground-breaking meeting of North and South Korean leaders.

European shares were set to end the week with a flourish too with a pan-European index set to post its fifth week of gains in a row, rivalling last September’s winning streak, with the tech sector strongly outperforming.

The latest gains are being partly spurred by forecast-beating first quarter earnings from two of the so-called FANG tech stocks — some of the world’s largest and most influential companies by market capitalisation — which has boosted sentiment on the technology sector worldwide. Amazon.com Inc shares jumped more than 6 per cent in after-market trading while Facebook surged 9.1 per cent on Thursday, calming worries about the fallout from its use of consumer data.

“Macroeconomic data has been soft in a number of key economies, so it is reassuring that amid those concerns we are still seeing strong earnings numbers coming through from big ticket corporates such as Amazon and Facebook,” said Investec economist Victoria Clarke.

“This is a good gauge of the broad drivers of sentiment particularly when there are those concerns about demand holding up in the face of weak economic data,” Clarke added.

European tech shares rose 0.75 per cent to the highest in more than five weeks, buoyed also by gains in local IT and chipmaking firms such as Capgemini, ASML and Infineon. In Britain, there was bad news on the growth front, with data showing the economy slowed much more sharply than expected.

However, sterling’s slide helped UK shares on the FTSE index to rise nearly half a per cent with gains led by multinational earners which earn a big chunk of their revenues overseas but report profits in pounds.

Asian markets revelled in the glow of the summit between North Korea’s Kim Jong-un and South Korean president Moon Jae-in. Political leaders and investors hope this would ease tensions over Pyongyang’s nuclear weapons programme and pave the way for the North and South to end their decades-long conflict.