Global Markets Surge as Investors Eye U.S. Economy Resilience

Global shares rebounded on Friday, erasing losses from a major sell-off earlier in the week. Investors grew optimistic about the U.S. economy's resilience after Federal Reserve policymakers signaled potential rate cuts by September. Oil prices also saw gains, while European and Asian markets showed signs of recovery.

Global shares extended gains on Friday, effectively erasing the losses incurred during a significant sell-off earlier in the week. Investors are betting on the resilience of the U.S. economy, as Federal Reserve policymakers indicated possible rate cuts as soon as September.

Reassurance from the Fed that inflation is cooling enough to allow for rate cuts, along with a substantial drop in U.S. jobless claims on Thursday, buoyed stock recovery efforts. Oil prices also saw a close to 3% weekly gain amid ongoing Middle East conflict fears, while the dollar held near its one-week high.

In Europe, the STOXX index of 600 companies rose 0.6%, nearly wiping out the week's losses. The VIX index, known as Wall Street's 'fear gauge,' dropped nearly 2%, indicating calmer market nerves compared to Monday's record spike. Japan's Nikkei also recovered, with broader Asia-Pacific shares reversing earlier declines to remain largely flat for the week.

(With inputs from agencies.)