LONDON, Feb 4 — European equities mostly climbed today and oil prices neared US$60 (RM243) per barrel, boosted by US stimulus hopes, vaccine rollouts and upbeat news from Italy.
Frankfurt stocks won 0.4 per cent and Paris climbed 0.5 per cent in afternoon trading, as investors shrugged off earlier losses in Asia.
“European markets have continued to gain ground... with another positive start, as confidence returns after the turbulence of last week,” commented CMC Markets UK analyst Michael Hewson.
Milan rose by 0.7 per cent after former European Central Bank chief Mario Draghi got to work on trying to form a new Italian government to lift his country out of coronavirus-induced turmoil.
“Draghi has been asked to form a government of national unity in Italy. He’s a highly skilled operator, a consummate politician and we know he’ll do ‘whatever it takes’ to steer Italy out of its worst economic and health crisis since the war,” said Markets.com analyst Neil Wilson.
BoE holds UK rate
However, London stocks gave up their gains after the Bank of England held its key interest rate at a record-low 0.1 per cent and stimulus levels steady, causing the pound to rise.
The BoE also cut its 2021 gross domestic product growth forecast to 5.0 per cent from 7.25 per cent although Britain has moved faster than most countries in its vaccination campaign.
The central bank also hinted at the possibility of negative interest rates later this year.
“The British pound surged after the BOE eased concerns that they were closer to considering negative interest rates,” said market analyst Edward Moya at online currency trading platform Oanda.
“Hope for the best and prepare for the worst is what the BOE is telling the banks,” he added.
Oil nears US$60
In commodities meanwhile, world oil prices continued to barrel their way closer to the key US$60 dollar level, with economic recovery hopes boosted by vaccine rollouts.
An upbeat global outlook pushed oil higher, with top producers sounding a note of optimism for demand this year as lockdowns are eased and activities slowly resume.
After lockdowns began to spread towards the end of last year’s first quarter, oil prices dropped off a cliff and even briefly turned negative.
Prices then rebounded sharply, however, and this week attained levels last seen before the pandemic erupted, with Brent not too far from US$60 per barrel.
Meanwhile, US stocks moved higher at the start of trading, with the Dow adding 0.2 per cent, as President Joe Biden continues to push forward on a US$1.9 trillion economic stimulus package.
Data showed that first-time job claims for the week ending January 30 dipped from the previous week to 779,000.
“The key takeaway from the report is that the level of initial claims improved; however, they didn’t improve nearly enough to drown out calls highlighting the need for additional stimulus and extended jobless benefits,” said analyst Patrick J. O’Hare at Briefing.com.
Key figures around 1330 GMT
London — FTSE 100: DOWN 0.2 per cent at 6,495.40 points
Frankfurt — DAX 30: UP 0.4 per cent at 13,986.79
Paris — CAC 40: UP 0.5 per cent at 5,588.08
Milan — FTSE MIB: UP 0.7 per cent at 22,676.28
EURO STOXX 50: UP 0.4 per cent at 3,624.32
New York — Dow: UP 0.2 per cent at 30,785.64
Tokyo — Nikkei 225: DOWN 1.1 per cent at 28,341.95 (close)
Hong Kong — Hang Seng: DOWN 0.7 per cent at 29,113.50 (close)
Shanghai — Composite: DOWN 0.4 per cent at 3,501.86 (close)
Euro/dollar: DOWN at US$1.1988 from US$1.2036 at 2200 GMT
Dollar/yen: UP at 105.36 yen from 105.03 yen
Pound/dollar: UP at US$1.3668 from US$1.3647
Euro/pound: DOWN at 87.71 pence from 88.19 pence
West Texas Intermediate: UP 0.5 per cent at US$55.99 per barrel
Brent North Sea crude: UP 0.4 per cent at US$58.68 per barrel — AFP
