Sun, 28 Feb 2021

  • Europe's major equity markets were steady Wednesday as investors awaited a breakthrough in key US economic stimulus talks.
  • Falling coronavirus infection rates, growing vaccination programmes and the prospect of a huge US spending splurge provided only limited support as traders paused following last week's bumper gains.
  • "European markets appear to be set for another day of contemplation, with the gains of last week giving way to a period of consolidation," said a senior market analyst.

Europe's major equity markets were steady Wednesday as investors awaited a breakthrough in key US economic stimulus talks, dealers said.

Falling coronavirus infection rates, growing vaccination programmes and the prospect of a huge US spending splurge provided only limited support as traders paused following last week's bumper gains.

Oil prices extended their impressive run to strike fresh 13-month peaks, as dealers bet on rebounding demand.

Bitcoin dipped to $46 784.38 after striking a record close to $50 000 Tuesday. The dollar was mixed.

"European markets appear to be set for another day of contemplation, with the gains of last week giving way to a period of consolidation," said Joshua Mahony, senior market analyst at online trading group IG.

"Despite notable market drivers in the form of the US stimulus plans and ongoing coronavirus vaccination programme, the gains seen last week appear to have captured much of that initial improvement in sentiment.

"Instead, we appear to be in a holding pattern as markets await a breakthrough in (US) stimulus talks."

Dealers remain upbeat about the chances of President Joe Biden pushing through his $1.9 trillion economic rescue package despite warnings that the move -- along with an expected economic recovery - would fan inflation.

Asian stock markets earlier closed higher with eyes firmly on the longer-term outlook for the global economy, as lockdowns are eased and life slowly improves.

Worries remain, however, that markets may have gone a little too far, which analysts said was capping any surge for now.

Declines in new coronavirus cases, deaths and hospitalisations in major economies including the United States, Britain and Europe are fanning expectations they can begin opening up soon despite the emergence of new strains.

Hong Kong led Asia's rally, piling on 1.9% thanks to a surge in Tencent and NetEase following news Chinese authorities had given the green light to their most eagerly awaited video games.

Shanghai also rose more than one percent on Chinese data indicating the economy was in recovery mode.

Gains in Tokyo were capped by news the Japanese government will keep containment measures in place.

Source: News24

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