Markets Stabilize Amid Rate Cut Speculation and Strong Economic Data

Global markets saw stabilization on Thursday after a rough start to September, driven by investor bets on potential U.S. Federal Reserve rate cuts. European stock exchanges held steady, supported by better-than-expected German industrial orders and stable euro zone retail sales. U.S. Treasury yields fell, reflecting concerns about the global economy.

World share and oil prices stabilized on Thursday after a brutal start to September, with the yen climbing to a one-month high and government bond markets rallying as investors continued to speculate on potential U.S. Federal Reserve rate cuts.

The severe market volatility, which had erased over $2 trillion from global stock markets and battered commodity prices, eased just enough for Europe's primary bourses to hold their ground after substantial losses earlier. German industrial orders came in stronger than anticipated, euro zone retail sales met expectations, and critical U.S. data releases were awaited.

Investor sentiment remained cautious yet hopeful as discussions around a significant Fed rate cut persisted. Favorable U.S. non-farm payroll data due later this week added to the anxious anticipation. Concurrently, Euro zone bond yields declined for a third consecutive session, and U.S. Treasury yields hovered at 3.765% amid ongoing economic health concerns. U.S. job openings had already hit a 3-1/2 year low in July, prompting markets to price in a higher probability of significant rate cuts by the year's end.

(With inputs from agencies.)