(Bloomberg) — The euro gained and European stock index futures pointed to a stronger open after talks between US and Russia spurred optimism about a possible end to the war in Ukraine.
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The region’s futures contracts climbed about 1%, while the euro strengthened 0.5% against the dollar. The Swedish krona and the Danish and Norwegian currencies also advanced while oil fell for a second day on speculation that risks to Russian supply may ease.
The weaker dollar reflected falling appetite for haven assets as investors looked past Wednesday’s faster-than-expected US inflation figures — which eroded bets on rate cuts. Traders are instead focusing on President Donald Trump’s Ukraine peace talks with Russia, which swept aside three years of US policy and blindsided European allies.
“The warmer tone in the risk environment across the region reflects some shrug-off of the higher-than-expected US inflation,” Jun Rong Yeap, market strategist at IG Asia Pte, wrote in a note. “More inflation data is needed to establish a trend and markets were already positioned for a prolonged Fed hold.”
A gauge of equities in Asia climbed for a second day.
The upswing in risk appetite came after the Asian regional stock gauge underperformed its global peers so far this year as Trump’s tariff threats, a stronger dollar and China’s lack of domestic policy stimulus weighed on the market. Chinese equities though have been lifted in recent weeks by an artificial intelligence breakthrough.
Shares of aluminum producer United Co Rusal International PJSC jumped as much as 29% in Hong Kong, the biggest gain in almost three years. Asian shipping stocks fell on concern freight rates may drop.
Market sentiment got a boost from “the potential resolution of the Russia-Ukraine conflict and the ongoing momentum in China’s tech sector,” said Charu Chanana, chief investment strategist for Saxo Markets Pte in Singapore.
Yields on 10-year US Treasuries edged down after jumping on Wednesday.
Trump agreed in a phone call with Russian President Vladimir Putin to start negotiating an end to the war in Ukraine.
Traders’ rush to buy Chinese technology stocks for their artificial intelligence potential has put the Hang Seng Tech Index on course for its highest close since the nation’s Covid-era reopening rally. The frenzy is turning Alibaba Group Holding Ltd. into an investor favorite again with its Hong Kong-listed shares surging 46% since hitting a 2025 low on Jan. 13.
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