London(AFP): Europe stock markets rose yesterday as fading fears of a US-China trade war prompted fresh buying in Europe and pushed Wall Street higher for the second straight session.
“US stocks are adding to yesterday’s sharp recovery in early action, with trade war concerns between China and the US appearing to continue to cool,” Charles Schwab consultants said.
Investors were “buoyed” by a “softening trade stance”, senior market analyst Craig Erlam of OANDA said. Trump last week imposed tariffs on some $60bn of Chinese imports over the “theft” of intellectual property.
This week, nerves were soothed as it emerged that high-level talks had been taking place between the world’s top two economies to find an agreement.
Jasper Lawler, head of research at London Capital Group, said the ongoing rebound went some way towards unwinding losses “from one of the worst weeks in recent years for stock markets”.
But he cautioned investors “not to get too excited” because “huge up-days do not typically happen in a strong market”.
Instead, this looked like a “dead cat bounce”, Lawler said.
In Europe, takeover activity boosted sentiment — with shares in GlaxoSmithKline jumping after the British drugs giant agreed to buy Novartis’ stake in the pair’s consumer healthcare joint venture for $13bn (€10.4bn).
The Swiss group said the sale of the 36.5% stake would enable it to focus on its core pharmaceutical business.
Earlier Tuesday, Asia also performed well, with Tokyo closing higher thanks to a drop in the yen against the dollar, as traders shifted out of assets considered safe in times of uncertainty and turmoil.
Seoul rose 0.6% and the won climbed more than 1% against the dollar on speculation Kim had visited China — in what would have been his first trip outside North Korea since assuming power at the end of 2011.
And if confirmed, the visit would mark the latest development in the fast-paced shift towards an easing of tensions on the Korean peninsula.
In London, the FTSE 100 closed up 1.5% to 6,994.85 points; Frankfurt — DAX 30 closed up 1.6% to 11,970.83 points and Paris — CAC 40 ended up 1.0% to 5,115.74 points yesterday.