European Stocks Higher; Bank of England Meeting Due

This post was originally published on this site – European stock markets traded higher Thursday, with investors buoyed by progress over Brexit negotiations and U.S. stimulus talks, ahead of the Bank of England’s latest policy-setting meeting.

At 3:50 AM ET (0850 GMT), the DAX in Germany traded 1% higher, the CAC 40 in France rose 0.5%, and the U.K.’s FTSE index climbed 0.3%. 

EU and U.K. negotiators continued to discuss the future trade relationship between the two sides, with a breakthrough still seemingly tantalisingly far away.

European Commission President Ursula von der Leyen told the European Parliament in Brussels on Wednesday that “there is a path to an agreement now” on a deal, with fishing rights appearing to remain a key sticking point.

Helping sentiment was the news that Germany and France will begin inoculating their citizens with the Pfizer-BioNtech vaccine in the last week of December, once it is approved by the European Medicines Agency.

Across the Atlantic, negotiations over a new coronavirus-relief spending package continued on Wednesday, with senior U.S. lawmakers on both sides sounding more positive than they have in months about approving a $900 billion stimulus bill.

The U.S. Federal Reserve meanwhile held off from increasing its asset purchases, although Fed Chairman Jerome Powell said it will maintain its massive asset purchase program until it sees “substantial further progress” in employment and inflation. 

The Bank of England is next up, holding its last meeting of the year later Thursday. It’s widely expected to refrain from yet more stimulus , having already increased its asset purchase program last month. 

In corporate news, Rio Tinto (NYSE:RIO) stock rose 1.6% after the mining giant named finance director Jakob Stausholm as its new CEO, while Electricite de France stock rose 2.6% after it raised its EBITDA forecast for 2020 to over 16 billion euros.

Also in the U.K., telecoms group and Internet provider Talk Talk (LON:TALK) stock climbed 2.4% after it said it had agreed to sell itself to a buyout fund backed by Martin Hughes’ Toscafund.

WPP (LON:WPP) stock rose 2.9% after the advertising giant forecast its earnings to rise by double-digits over the next three years.

Oil prices surged Thursday, hitting a nine month-high after government data showed a fall in U.S. crude stocks last week, suggesting demand remained resilient despite the surge in Covid-19 cases.

U.S. crude inventories fell by 3.1 million barrels in the week to Dec. 11, the Energy Information Administration said late Wednesday. The extent of this drop came as a surprise, particularly after the industry group API reported Tuesday that stocks grew by almost 2 million barrels in the same time period.

U.S. crude futures traded 1.2% higher at $48.41 a barrel, while the international benchmark Brent contract rose 1.2% to $51.68. Both benchmarks hit their highest levels since early March.

Elsewhere, gold futures rose 1.3% to $1,883.95/oz, while EUR/USD traded 0.3% higher at 1.2233.

Add Comment