Europe Opens Higher After Late Run on Wall Street

European stocks are heading out of the blocks on the front foot after a late run higher on Wall Street.

US Fiscal stimulus hopes boosted the mood in the market in late trade on Thursday, helping the US indices close on positive ground. US lawmakers are reportedly working on a $2.2 trillion coronavirus stimulus package which could be voted on a soon as next week.

The news comes after the latest US jobless claims data showed that 870K Americans signed up for unemployment benefit last week, above the 860K the week before, in a sign that the recovery in the US labour market is plateauing.

More stimulus needed in Europe?
The prospect of additional fiscal stimulus to support the stalling economic recovery in the world’s largest economy is boosting sentiment even as covid cases in Europe unnerve investors. There is a good chance the EU might also need to dip its hand in its pocket again.
The likelihood that EU will need to agree to further stimulus as well is rising. Data earlier this week showed that the economic recovery in the eurozone is on very shaky ground with service sector activity already back in contraction. With covid cases rising in the old continent and further tightening restrictions almost certain over the coming weeks, the chances of a double dip recession are rising.

Commodity prices rise lifting FTSE
The FTSE is managing to advance, as the prospect of additional US stimulus is dragging on the US Dollar, offering some relief to the battered commodities. As commodity process rise on the weaker dollar, heavy weight miners and oil majors are advancing.

Vaccine updates
Vaccine news is not offering support to sentiment. Novavax started a late stage trial of its covid-19 vaccine candidate in partnership with the British government’s Vaccine Taskforce. With UK covid cases reaching 6,634 over the past 24 hours and restrictions being tightened to stem the spread of the virus, any even mildly positive vaccine news is welcome right now.

In other Vaccine news, AstraZeneca has struck a deal with the EU to receive partial immunity from risks involved with the speedy roll out of its covid-19 vaccine. The EU have agreed to pay claims over certain side effects above a certain limit, shifting the liability of risks associated with such a quick vaccine development away from the drug maker to the taxpayer. However, the news has failed to lift the share price.

FTSE Chart

From time to time, StoneX Financial Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.

FOREX.com is a trading name of StoneX Financial Pty Ltd.

The material provided herein is general in nature and does not take into account your objectives, financial situation or needs.

While every care has been taken in preparing this material, we do not provide any representation or warranty (express or implied) with respect to its completeness or accuracy. This is not an invitation or an offer to invest nor is it a recommendation to buy or sell investments.

StoneX recommends you to seek independent financial and legal advice before making any financial investment decision. Trading CFDs and FX on margin carries a higher level of risk, and may not be suitable for all investors. The possibility exists that you could lose more than your initial investment and CFD investors do not own or have any rights to the underlying assets.

It is important you consider our Financial Services Guide and Product Disclosure Statement (PDS) available at www.forex.com/en-au/terms-and-policies/, before deciding to acquire or hold our products. As a part of our market risk management, we may take the opposite side of your trade. Our Target Market Determination (TMD) is also available at www.forex.com/en-au/terms-and-policies/.

StoneX Financial Pty Ltd, Suite 42.01, 264 George Street, Sydney, NSW 2000 (ACN 141 774 727, AFSL 345646) is the CFD issuer and our products are traded off exchange.

Delayed London Stock Exchange (LSE) Data

The London Stock Exchange (LSE) market data displayed or referenced on this website is provided on a delayed basis and is not in real time. The delay period may vary but is typically at least 15 minutes. This data is intended for information purposes only and should not be relied upon for trading, investment, or other financial decisions. We do not guarantee the completeness, reliability, or suitability of the data for any particular purpose. Users should consult real-time data sources and obtain professional advice before making any financial decisions.