European stocks rise due to cancellation of COVID in China
2022.12.27 08:30
European stocks rise due to cancellation of COVID in China
Budrigannews.com – Following China’s latest relaxation of its COVID-19 restrictions, which raised hopes of a recovery in the world’s second-largest economy, European shares increased on Tuesday, following a global rally in equities.
The pan-European index started the holiday-shortened week higher by 0.4 percent.
China announced on Monday that it would eliminate quarantine requirements for visitors coming into the country, easing three-year border controls meant to reduce COVID [ MKTS/GLOB] In early trading, the majority of European bourses advanced while London and Dublin markets remained closed for the Christmas holiday.
According to Swissquote Bank senior analyst Ipek Ozkardeskaya, the Chinese reopening and in-line U.S. inflation data on Friday could provide a “minor boost to equity markets.”
Ozkardeskaya added, however, that an increase in COVID-19 cases in China could “throw a shadow on the reopening glow.”
Richemont and LVMH, two luxury companies that are exposed to China, gained nearly 1.7%.
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According to Refinitiv data based on Thursday’s closing price, miners and energy stocks gained 1.0 percent and 1.4 percent, respectively, as commodity prices surged in anticipation of a recovery in China’s top consumer demand. MET/L] [O/R] These sectors also rose on the day.
The broader European index increased as a result of gains in industrials and banks for the second consecutive session.
Thin trading volumes, according to traders and analysts, also influenced market movements.
According to a Reuters survey, German businesses anticipate a mild recession next year despite the energy crisis, raw material shortages, and weak global economy.
The largest economy in Europe, Germany, saw a 0.5% increase in shares.
Due to global central banks’ aggressive monetary policy tightening, the European STOXX 600 index has lost nearly 12% so far this year and is on track for its worst annual performance since 2018. This is due to concerns about an economic recession.
Leonteq fell 4.4% among individual movers after the Swiss fintech company said that lower client demand in the second half of the year had lowered its profit expectations for 2022.
Lotus Bakeries NV, which is based in Belgium, fell 4.6 percent to the index’s lowest point.
