Equities eye third week of gains after tech boost, dollar dips By

By Simon Jessop

LONDON (Reuters) – Global shares got a tech boost to help tee up a third straight week of gains on Friday, despite growing inflation concerns, while the dollar dipped and oil prices bounced off their lows.

MSCI’s broadest gauge of global shares was up 0.1%, 1.4% higher on the week and just 0.8% off its all-time high. Europe’s top markets were all up, with the biggest, 100, up 0.4%.

That followed gains in Asia, where advanced 0.3%, led by the technology sector, and equity bulls were also comforted by news that heavily indebted Chinese property firm China Evergrande Group had made a surprise interest payment, averting a default for now.

The risk-on tone came despite growing investor concern that persistent inflation could force central bankers to tighten monetary policy at a point where global economic growth remains fragile.

Data on Friday showed euro zone inflation expectations are at their highest in years, amid a rash of warnings from companies including Nestle, ABB and Unilever (NYSE:).

The German 10-year breakeven inflation rate,, which represents the difference in yield between a nominal bond and its inflation-indexed counterpart, rose to around 1.81%, the highest since April 2013.

Rising prices crimped euro zone growth in October and could set the scene for a tough meeting of the European Central Bank next week, said Neil Birrell, Chief Investment Officer at asset manager Premier Miton.

“The ECB meets next week, it has plenty to discuss, a faltering economy and rising inflation; it is under pressure to tackle the inflation spike but needs to tread carefully with any change in policy.”

Despite concern that inflation pressures could push governments to tighten monetary policy too quickly, Mark Haefele, Chief Investment Officer, UBS Global Wealth Management, said in a note to clients that equities could still move higher.

“With current issues still appearing more temporary than structural, we believe equity markets will continue to move higher,” Haefele said.

“Indeed, small increases in inflation expectations can be positive for markets if it helps to banish fears of deflation. Furthermore, by our assessment, global growth remains strong, supply chain challenges should recede into 2022, and corporate earnings should continue to grow.”

U.S. stock futures point to a flat open on Wall Street, after the cash index posted a record closing high overnight, led by surging tech shares.

Next week, Facebook (NASDAQ:), Apple (NASDAQ:), Amazon (NASDAQ:), and Google-owner Alphabet (NASDAQ:) all report, with bulls hoping they can follow forecast-beating earnings this week from Netflix (NASDAQ:).

Meanwhile, yields on benchmark were at 1.6908%, easing back from a five-month high of 1.7050% reached overnight.

The , which gauges the greenback against six major rivals, was down 0.1% to 93.634, despite…