Market Rebounds After Huge Drop
The Stockholm Exchange rebounded Tuesday morning after Monday’s sharp fall, amid signs of a strong economy.
Drawn down by falling markets in Asia and the United States, Stockholm’s OMX exchange fell 5.3 percent Monday, wiping out gains since the beginning of the year. It was the biggest drop since the September 11, 2001 attacks.
But Tuesday’s first half hour saw the Stockholm 30 index rise by 2.5 percent.
Despite the global market slump, Swedish central bank chief Stefan Ingves said on Tuesday that interest rates here need to rise due to expectations of increasing inflation. The comment supports analysts’ view that a third rate hike this year will come in June.
Meanwhile, a new report from the Organization for Economic Cooperation and Development says the world economy is strong but vulnerable, and Sweden is growing faster than the United States and several other economic powers. The OECD predicts the industrialized economies will grow by 3.1 percent this year, with growth in Sweden at nearly 4 percent.