Global Stocks Touch New Highs
By Riva Gold and Lucy Craymer
-- World stocks on track for fresh record
-- Pound continues to strengthen
-- Nikkei above 21000
Stocks found fresh momentum Friday, with a popular gauge of global equities on track to end at its highest on record.
The MSCI World equity benchmark of large and mid-cap stocks was set to hit another all-time high amid gains in Asian and European bourses.
The Dow Jones Industrial Average gained 36 points, or 0.2%, to 22877 shortly after the opening bell. The S&P 500 added 0.1%, and the Nasdaq Composite climbed 0.2%.
The Stoxx Europe 600 edged up 0.1%, following gains in Japan and Australia.
Europe's banking sector pared some early losses after declines in bank shares pulled U.S. stocks away from record levels Thursday.
Shares of Bank of America fell 0.8% after the bank reported its quarterly profit had risen 13% from a year earlier. Wells Fargo slid 4% as the bank reported weaker-than-expected third-quarter revenue, down 2% from a year ago
Recent economic data releases have helped confirm a synchronized pickup in global growth, just as the third-quarter earnings season has so far pointed to a healthy corporate sector, encouraging equity investors. Flows into global equity funds during the week ending Oct. 11 hit a record, according to fund tracker EPFR Global.
"I continue to see a positive story for risk," said Tina Byles Williams, chief investment officer at FIS Group.
"All the normal signs of economic activity and earnings are in a positive direction with the possible exception of China," she added, saying she favors stocks in Japan and Europe.
Gains in commodity prices supported shares of energy and mining companies on Friday. Brent crude oil gained 2.1% to $57.42 a barrel.
Germany's DAX index was flat near all-time highs. Shares of Bayer rose 1.1% after the German company agreed to sell parts of its crop-science business to rival BASF, whose shares fell 0.2%.
London's export-heavy FTSE 100 fell 0.2% from a record close, bucking the global trend of gains, as the pound continued its ascent against the dollar.
The pound was last up 0.4% at $1.3315 following media reports that Michel Barnier, the European Union's chief Brexit negotiator, said Thursday that the EU might agree to a two-year transition period. Sterling had fallen sharply earlier Thursday on reports of deadlocked negotiations.
In Asian trading Friday, stocks closed mostly up. Korea's Kospi, however, struggled to log a third-straight record close, edging down less than 0.1%.
Traders came back from the midday break in Japan in an upbeat mood, with the Nikkei climbing more after sprinting to heights last seen in 1996. The benchmark finished up 1% at 21211.29.
"The Nikkei has got a lot of tailwinds behind it and few of the headwinds of other markets," said Rob Carnell, ING's Asia-Pacific research chief.
Despite looming elections, he noted markets weren't concerned there will be a change of government in Japan, while export figures continue to be strong and the Bank of Japan remains in expansionary mode.
New Zealand's stock benchmark logged a record-extending ninth-straight gain to new highs and Australian shares rose 0.3%.
Amid Friday's stock gains, China released figures showing imports jumped a bigger-than-expected 19% in dollar terms from a year earlier in September. The Shanghai Composite rose 0.1%.
Yields on 10-year Treasury notes edged down to 2.279% from 2.323%. German bund yields edged down to 0.404% from 0.445%. Yields move inversely to prices.
That followed media reports suggesting the European Central Bank might keep its bond purchases going for longer, even as it reduces the size of the program by more than expected.
"Overall, the developments suggest that the ECB will continue to stress that loose policy will remain in place for a long time even as they begin to slow the pace of quantitative easing," said strategists at MUFG.
Marina Force contributed to this article.
Write to Riva Gold at firstname.lastname@example.org and Lucy Craymer at Lucy.Craymer@wsj.com