U.S. futures, stocks rise as traders eye peak rates

U.S. equity futures climbed on investor bets that a peak in interest rates is near and bank turmoil will ease further.

S&P 500 contracts and those on the tech-heavy Nasdaq 100 advanced at least 0.4 per cent after a rally on Wednesday that pushed the latter into a bull market. Retail shares led gains in the Stoxx Europe 600 Index, with Hennes & Mauritz AB soaring after the Swedish clothing company's first-quarter results beat expectations. 

Stocks have been drifting higher in recent days as the worst of the bank selloff recedes, even with a lack of fresh news on the direction of interest rates. Attention in the US turns next to jobless data, GDP numbers and the core personal consumption expenditure reading for insights on the Federal Reserve's policy moves. Investors now expect U.S. rates to sit around 4.3 per cent by the end of the year, around 70 basis points lower than the current level.

“Market sentiment remains relatively positive, and investor confidence remains high despite the recent turmoil brought by the financial sector, as appetite for risk gets supported by the prospect of dovish pivots from central banks, providing a good excuse to push stock indices higher just before the end of the quarter,” said Pierre Veyret, a technical analyst at ActivTrades.