European stock markets climb on economic recovery optimism
UK prime minister Boris Johnson has confirmed that Britain is still on track to ease all restrictions by 21 June, including the COVID-19 social distancing rule. Photo: Lindsey Parnaby/WPA Pool/Getty
European stock markets opened higher on Tuesday as most major economies continue the slow grind towards normality.
The FTSE 100 (^FTSE) rose 0.76% after opening in London, while the French CAC (^FCHI) gained 0.36% and the DAX (^GDAXI) in Germany edged 0.02% higher.
On Monday, prime minister Boris Johnson confirmed that Britain is still on track to ease all restrictions by 21 June, including the COVID-19 social distancing rule requiring people to stay at least one metre apart.
During a campaign visit to Hartlepool, he said: “We do want to do some opening up on May the 17th, but I don’t think that the people of this country want to see an influx of disease from anywhere else. I certainly don’t. We’ve got to be very, very tough, and we’ve got to be as cautious as we can.”
According to the latest government figures, some 34.5 million people in the UK have received a first dose of the coronavirus vaccine, while 15.5 million have received their second jab.
Investors will also be keeping a watchful eye on elections this week as local and Scottish elections take place on Thursday.
The outcome of the election could have a huge effect on financial markets and the UK economy, particularly if the SNP wins a majority of seats.
This is because Nicola Sturgeon’s party, along with the Greens, are hoping for a second referendum on Scottish independence, with the aim for an independent Scotland to rejoin the EU as quickly as possible.
READ MORE: What the Scottish election means for the economy, your investments and the pound
S&P 500 futures (ES=F) were down 0.08%, Dow futures (YM=F) shed 0.01%, and Nasdaq futures (NQ=F) were 0.15% lower as trade began in Europe.
“In the US, there is further evidence of the “reopening” trade, with investors anticipating stocks and sectors likely to benefit from the return to some kind of normality,” Richard Hunter at Interactive Investor said.
“This in turn has applied some pressure on tech stocks, despite their largely upbeat earnings numbers, where valuations are coming under increasing scrutiny as the scale of their recent pandemic success comes into question as lockdowns subside.”
Trading in Asia was thinned out by public holidays in China and Japan, however share markets were mostly higher.
MSCI’s broadest index of Asia-Pacific shares outside Japan closed up on the back of a positive lead from Wall Street overnight.
Hong Kong’s Hang Seng index (^HSI) climbed 0.56%.
Japan and mainland China’s markets remained closed on Tuesday for holidays, dampening trading volumes across the region.
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