European stocks surge on hopes of quicker economic recovery


LaToya Harding
·ContributorMon, 15 February 2021, 8:42 am

London’s benchmark index climbed 0.91% after the opening bell, rising to its highest level in two and a half-weeks.Photo: Daniel Sorabji/AFP via Getty Images
London’s benchmark index climbed 0.91% after the opening bell, rising to its highest level in two and a half-weeks.Photo: Daniel Sorabji/AFP via Getty Images

European markets opened solidly higher on Monday, with the FTSE 100 (^FTSE) shrugging off pressure from a stronger pound, rising to its highest level in two and a half-weeks.

London’s benchmark index climbed 0.91% after the opening bell, while the DAX (^GDAXI) climbed 0.4% and the CAC (^FCHI) rose 0.53% amid hopes of rapid economic recovery.

Mining companies and energy producers are leading the rally in London, although travel and hospitality stocks are also stronger.

“Brighter sentiment has, for the moment, reached UK shores,” said Richard Hunter at Interactive Investor.

“The government appears on track to meet its vaccination milestone, which is hoped to be a precursor to the lifting of restrictions and therefore the ability of the economy to begin growth under its own steam. The initially positive reaction to the news leaves the FTSE 100 ahead by 2.9% in the year to date.”

READ MORE: Pressure on UK government to map ‘clear route out of the crisis’

US markets are closed on Monday for Presidents Day. Last week the S&P500 (^GSPC) and tech-heavy Nasdaq (^IXIC) again reached record highs.

Asian shares hit record highs overnight as the coronavirus vaccine rollout continues to raise hopes of a rapid economic recovery. It was also fuelled by new fiscal aid from Washington, while oil prices rose on heightened tensions in the Middle East.

MSCI’s broadest index of Asia-Pacific shares outside Japan jumped 0.57%.

Japan’s Nikkei 225 index (^N225) closed above 30,000 points for the first time since 1990, after the country’s economy recorded another quarter of double-digit annualised growth to beat expectations.

Japan’s economy expanded more than expected in the fourth quarter, extending its recovery from its worst post war recession. It came as overseas demand boosted exports and capital expenditure.

The world’s third-largest economy grew an annualised 12.7% in October-December, government data showed, marking the second consecutive quarter of increase and exceeding a median market forecast for a 9.5% gain.

China and Hong Kong markets are shut for the Lunar New Year holiday.