LONDON (AFP/APP): European equities rallied Tuesday as investors played catch-up with record Wall Street gains, cheering strong US data showing the world’s top economy was well on the recovery track.
Frankfurt, London and Paris fizzed higher as dealers returned to their desks following a long four-day Easter holiday weekend, and after a mixed performance in Asia.
“Today is the first chance for European markets to react to this fresh wave of optimism after an extended weekend, and indeed to the possibility that global economies will be lifted by a recovery which is expected to be led by the US in the first instance,” said Interactive Investor analyst Richard Hunter.
Wall Street nailed record gains after pre-weekend data showed far more US jobs than expected were created last month, reinforcing the view of a strong recovery.
The S&P 500 and Dow scaled new heights, while the Nasdaq also saw big gains, after data Friday showed the US economy regained 916,000 jobs in March.
And the good news kept coming on Monday with figures showing activity in the crucial services sector hit an all-time high in March, as orders surged thanks to a jolt of pent-up demand. That came after a gauge of manufacturing came in at a 37-year high.
“Taking their cues from the Dow Jones (index), the European markets had a proverbial spring in their step as they returned from the Easter break,” said Spreadex analyst Connor Campbell.
“In the peace and quiet of a Europe-free Good Friday and Easter Monday, the Dow made strides, climbing above 33,500 (points) for the first time in history following a blockbuster 916,000 non-farm employment change reading.
“This has helped the European indices bound out of the gates this Tuesday.”
The strong economic readings came as traders take heart from good progress in vaccination rollouts in the United States and Britain, which are allowing governments to ease containment measures.
In Asia, Sydney, Seoul, Mumbai, Jakarta, Taipei and Manila stock markets all rose.
On the downside, Tokyo sank more than one percent on profit-taking after recent gains, while Singapore and Wellington also fell.
Oil prices rallied as observers said the chances of a breakthrough in Iran nuclear talks were slim.
Both contracts tumbled last week on the prospects that the country’s crude could return to markets if negotiations on the accord progressed smoothly and sanctions on the country were eased.
