German recovery suffers shock

Thank you for joining me. French stocks and broader European markets are set to rise in the coming days following the election result in Europe’s second-largest economy.

Morgan Stanley strategists said a hung parliament and a National Rally majority would likely lead to a “relief rally” after the sharp fall seen after Emmanuel Macron called for a vote last month.

5 things to start the day off right

1) Royal Mail faces rising debt bill after ‘Czech Sphinx’ takeover | The buyout risks tripling borrowing costs because of the billions of dollars invested in financing

2) How Italy shed its ‘basket case’ image and robbed British millionaires | Meloni’s Milan is set to overtake London as the playground for the rich

3) Jim Ratcliffe delays launch of electric SUV | Ineos cites weak demand for electric vehicles as reason to put car on hold

4) BMW attacks EU tariffs on Chinese electric car imports | Criticism comes amid fears of Beijing backlash over German exports

5) Matthew Lynn: Moral bankruptcy of home workers will lead Britain to the brink | Addition of sixth working day in Greece shows that countries can change their destiny

What happened during the night

Asian stocks hit 27-month highs as weaker-than-expected jobs figures reduced the chances of a September U.S. rate cut.

Independence Day in the United States saw limited trading as investors waited to see the outcome of the British election.

Across the Channel, polls suggest the National Rally (RN) will fail to win a majority of seats in Sunday’s French elections, with the main parties scrambling to block the far right.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.9% to its highest level since April 2022.

Japan’s Nikkei climbed 0.9% to near its March peak, while the broader Topix hit all-time highs.

Taiwan’s main index also hit a record high, led by the technology sector and Taiwan Semiconductor Manufacturing Co (TSMC), which broke the $1,000 trillion mark for the first time.

On Wall Street, the S&P 500 rose 0.5% to 5,537.02 points, setting a record high for a second consecutive day and for the 33rd time this year.

The Dow Jones Industrial Average fell 0.1% to 39,308.00, while the Nasdaq Composite added 0.9% to its record high set the day before, closing at 18,188.30. Trading ended early in the day ahead of the July 4 holiday.

The yield on the 10-year U.S. Treasury note fell to 4.35% from 4.44% late Tuesday, a notable move for the bond market, and much of the decline came after a report on U.S. services companies.