European stock markets edged higher on Wednesday as Italy looked set to relax sweeping restrictions to contain the coronavirus, with investors remaining cautious about a swift recovery after more companies issued worrying financial forecasts.
European stocks were off to a firmer start on Wednesday despite fresh losses for oil prices. The Stoxx Europe 600 index (STOXX) rose 1.18% to 328.12. The German DAX (DAX) was up 1.2% and FTSE 100 index (UKX) rose around 1.4%, the French CAC 40 index gained 0.65%. US stock futures were also rising with Dow industrials futures YM00 up by 1.12% or 260 points. Investors looked past slumping oil prices with Brent crude June delivery futures touched $15.98 this morning or almost 20% from the opening price, levels not seen since 1999. Roche (ROG) shares slipped despite the drug-maker reporting higher sales and backing its 2020 view. Shares of Akzo Nobel (AKZA) went up by 7.20%, Randstad (RAND) – up by 1.3% were all higher after those companies reported results.
A positive start to the trading day in Europe: Eurostoxx +0.5%, Germany DAX +1.0% , France CAC 40, +0.3%, UK FTSE +0.6%, Spain IBEX +0.7%. This coincides with the more positive risk tones since late Asia Pacific trading with US futures still sitting about 1.54% higher currently.
Britain’s FTSE 100 index is seen opening 39 points higher at 5,680 on Wednesday, according to financial bookmakers, with futures gaining 0.9%, ahead of cash market open.
The European summit will be held by videoconference on Thursday and aims to clear the way to a pact on a massive and unprecedented injection of economic resources against an inevitable crisis. The agreement points to a historic expansion of the EU budget, from which would come the recovery fund proposed by Spain. The positive signs from Berlin towards this initiative encourage optimism in Brussels. However, no one rules out that the clash between the most extreme positions, represented by the Netherlands and Italy, could disrupt the summit or force new rounds of negotiations.
The positions of the European partners on the ambition of the necessary measures remain distant. But the latest movements of the German Chancellor, Angela Merkel, and Spain’s President, Pedro Sánchez, have opened a possible area of understanding on which a definitive agreement could be built.
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