Global Markets Rally Amid Rate Cut Bets and Trade Optimism

Global shares made cautious gains mid-week as traders took advantage of recent declines prompted by softer U.S. data and tariff worries. Benchmark U.S. Treasury yields climbed modestly from their recent lows. In Europe, the STOXX 600 index showed minor improvement, while most Asian indices posted earlier gains, and S&P 500 futures edged up by 0.2%.

The U.S. economic outlook remains a pivotal concern for investors. Tuesday's Wall Street downturn followed unexpected stagnation in the services sector for July, reinforcing the message from Friday's weak jobs report. This has increased market bets on a September rate cut by the Federal Reserve.

In the trade arena, President Trump hinted at upcoming tariffs on semiconductors and pharmaceuticals, likely impacting market sectors. As dialogues with China continue, there's optimism for a potential trade deal, though tensions with India over Russian oil purchases persist. Meanwhile, mixed corporate earnings paint a complex picture, with expectations of 10% EPS growth for the S&P 500 this quarter.

(With inputs from agencies.)