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Global stocks surge to new record highs for first time since 2015

CNBC logo CNBC 16/02/2017 Silvia Amaro

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Global stocks have pushed to new highs, outdoing previous records set in 2015, driven by strong economic data in the U.S. and comments by the Federal Reserve on the future path of interest rates.

The FTSE All-World index, which is priced in dollars and measures more than 7,000 companies in 47 countries, closed at 293.31 points on Wednesday afternoon and pushed even higher as stocks opened on Thursday. Reuters data showed this was the first record high reached since the end of May 2015. The benchmark is heavily geared towards America with U.S. stocks having just over a 50 percent weighting.

"Further consideration of the implications of Fed Chair (Janet) Yellen's comments for the path of U.S. interest rates, enhanced by another strong set of U.S. economic data releases, ensured that financials stocks continued to play a central part in further gains for world equity benchmarks yesterday," Ian William, an economist and strategist at Peel Hunt, said in a note on Thursday morning.

Yellen told U.S. lawmakers on Tuesday and Wednesday that the U.S. economy had dealt with the financial crisis better than European countries and that the economy had recovered from a very deep crisis. She also hinted that there could be an interest rate hike as early as next month.

Meanwhile, data on Wednesday showed retail sales in the U.S. increasing more than expected and expectations are that consumer spending will continue to be a key contributor to growth. Inflation has also come in higher than expected and manufacturing output has expanded. Such figures have boosted financial stocks across world markets, alongside Yellen's comments with lenders preferring an environment of higher interest rates.

"In the U.K., a late-session rally pushed the FTSE 100 (.FTSE) above 7,300 to its highest close in a month, with banks leading the way once again, backed by pharmas and life insurance," Hunt added.

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