London: Europe’s major stock markets rose Wednesday but gains were tempered as new investment regulations were rolled out across the region.
Investors have kicked off 2018 in buoyant mood as the world economy stirs to life and job creation, particularly in the United States, picks up.
World equity markets had already fizzed higher Tuesday on growing investor optimism, with the exception of key European markets, but some analysts cautioned over the outlook for the rest of the year.
Regardless, Wall Street powered on with small gains approaching midday in New York.
– ‘Europe choppy’ –
Europe also rose despite the introduction of so-called MiFID II rules, which seek to tighten financial market regulation to stop rampant speculation.
In a new twist on Wednesday, British markets regulator the Financial Conduct Authority and German counterpart BaFin both granted the complex derivatives market another 30 months to comply with MiFID II reforms.
Wednesday’s climb followed another record-breaking session on Wall Street.
Back in Europe, London trod 0.3 percent higher, with clothing retailer Next boosted by news of bumper Christmas sales, while Paris added 0.8 percent and Frankfurt 0.9 percent.
“European equities are mostly higher in afternoon action, rebounding slightly from yesterday’s shaky start to the New Year,” said analysts at the Charles Schwab brokerage.
But markets “are choppy as the European Union’s new investment regulations, known as MiFID, are taking effect today”, they added.
Earlier, Asia was given another strong lead from Wall Street where technology titans Apple, Amazon and Google-parent Alphabet were the standout performers.
– Dollar attempts recovery –
In foreign exchange activity on Wednesday, the dollar recovered somewhat against the euro following its recent poor form.
The European single currency had jumped Tuesday to a four-month high at $1.2081.
“Euro/dollar has eased off … after a smashing start for this year,” added ThinkMarkets analyst Naeem Aslam.
“The rally is primarily pumped by the optimism that the eurozone’s economy is performing well and the European Central Bank would stay on track to finish its ultra-loose monetary policy this year.”
Elsewhere, oil prices moved higher, having briefly hit 2.5-year peaks the previous day on geopolitical concerns in key crude producer Iran.
Source: Brecorder.com
