+ A
A -
AFP
London
Stock markets mostly rose on Wednesday as investors appeared willing to set aside fears of recession, instead focusing on bargain hunting, analysts said.
They also seemed to largely shrug off political turmoil in Italy.
“Recession nerves look to have settled a little following last week’s panic, which has brought some relief to markets,” said Craig Erlam at OANDA.
Global bond yields stabilised, indicating that markets are becoming less pessimistic about the outlook for the world economy.
Key European equity markets were more than one percent higher by the close.
That included Milan’s FTSE MIB index which rallied as Italian President Sergio Mattarella began talks with key players in a bid to end political limbo in the eurozone’s number three economy.
The index had dived 1.1 percent on Tuesday after the shock resignation of Prime Minister Giuseppe Conte.
“The markets have seemingly taken the latest political upheaval in Italy in their stride and are gaining,” noted XTB analyst David Cheetham.
US stock markets also made a better start, “aided by some stabilisation in global bond yields which had plunged recently to exacerbate market uneasiness and growth concerns”, said Charles Schwab analysts.
- Euro turns flat -The euro flatlined against the dollar as Italy’s crisis offset optimism that Germany’s government could unveil measures to avert a downturn. Conte resigned this week, hitting out at far-right Interior Minister Matteo Salvini for pursuing his own interests by bringing down the government coalition.
Mattarella must now decide to form a new coalition or call an election, throwing up more uncertainty and another possible budget standoff with the European Union.
“It is not clear whether or not the President will try and put a caretaker government in place at first -- though it seems likely that Salvini will be given the reins sooner or later,” Rabobank analyst Jane Foley told AFP.
“The confusion, combined with Salvini’s spending pledges, is potentially a negative factor” for the European single currency, she added.
VTB analyst Neil MacKinnon was more downbeat. “There is an increasing risk of a fresh eurozone debt and banking crisis,” he cautioned.
- Powell speech looms -Investors’ focus was starting to turn to a key speech by Federal Reserve boss Jerome Powell at the end of the week.
Rising hopes for China-US trade talks have provided a much-needed lift to markets over the past two days but with few fresh catalysts.
London
Stock markets mostly rose on Wednesday as investors appeared willing to set aside fears of recession, instead focusing on bargain hunting, analysts said.
They also seemed to largely shrug off political turmoil in Italy.
“Recession nerves look to have settled a little following last week’s panic, which has brought some relief to markets,” said Craig Erlam at OANDA.
Global bond yields stabilised, indicating that markets are becoming less pessimistic about the outlook for the world economy.
Key European equity markets were more than one percent higher by the close.
That included Milan’s FTSE MIB index which rallied as Italian President Sergio Mattarella began talks with key players in a bid to end political limbo in the eurozone’s number three economy.
The index had dived 1.1 percent on Tuesday after the shock resignation of Prime Minister Giuseppe Conte.
“The markets have seemingly taken the latest political upheaval in Italy in their stride and are gaining,” noted XTB analyst David Cheetham.
US stock markets also made a better start, “aided by some stabilisation in global bond yields which had plunged recently to exacerbate market uneasiness and growth concerns”, said Charles Schwab analysts.
- Euro turns flat -The euro flatlined against the dollar as Italy’s crisis offset optimism that Germany’s government could unveil measures to avert a downturn. Conte resigned this week, hitting out at far-right Interior Minister Matteo Salvini for pursuing his own interests by bringing down the government coalition.
Mattarella must now decide to form a new coalition or call an election, throwing up more uncertainty and another possible budget standoff with the European Union.
“It is not clear whether or not the President will try and put a caretaker government in place at first -- though it seems likely that Salvini will be given the reins sooner or later,” Rabobank analyst Jane Foley told AFP.
“The confusion, combined with Salvini’s spending pledges, is potentially a negative factor” for the European single currency, she added.
VTB analyst Neil MacKinnon was more downbeat. “There is an increasing risk of a fresh eurozone debt and banking crisis,” he cautioned.
- Powell speech looms -Investors’ focus was starting to turn to a key speech by Federal Reserve boss Jerome Powell at the end of the week.
Rising hopes for China-US trade talks have provided a much-needed lift to markets over the past two days but with few fresh catalysts.
