PARIS: European stocks have surged sharply after top US ambassador John Kerry held out the view for a fast lifting of US and EU sanctions on Russia if Putin reverses course in Ukraine.
After a day of volatile trading on Tuesday Europe’s main stock markets closed sharply higher following Kerry’s remarks, with London’s benchmark FTSE 100 index rising 2.41 per cent to 6,331.83 points.
The Paris CAC 40 rose 2.19 per cent to 4,093.20 points and Frankfurt’s DAX 30 gained 2.46 per cent to 9,563.89 points.
Madrid added 1.8 per cent and Milan jumped 3.27 per cent.
“Shares in Europe saw a mild recovery on Tuesday shaking off concerns of further oil price depreciation thanks to a record trade surplus for the Eurozone as well as an improved manufacturing and services industry outlook,” said CMC Markets UK analyst Jasper Lawler.
German investment sentiment rose sharply in December after a rebound the previous month, driven by a weak euro and plunging oil prices, a survey showed Tuesday.
The investor confidence index, calculated by the ZEW economic institute, jumped by 23.4 points in December, after rising for the first time this year in November, ZEW said in a statement.
A weaker euro also helped propel the eurozone’s trade surplus to 24 billion euros in October.
In addition, a key survey showed that business activity in the eurozone accelerated slightly in December.
Markit Economics said its Composite Purchasing Managers Output Index for the 18-country zone that uses the single currency rose marginally to 51.7 points in December from 51.1 points in November.
That helped lift the euro to $US1.250 from $US1.2435 late Monday, also propelled by upbeat eurozone and German data on the eve of the US Federal Reserve’s latest monetary policy decision.
Oil has suffered another dizzying plunge, with Brent crude sliding to a five-year low under $US59 as markets were rocked by shrinking Chinese manufacturing output and turmoil in Russia.
London’s benchmark contract Brent North Sea crude for January slumped as far as $US58.50 per barrel on Tuesday – the lowest level since May 2009, but it climbed back to $US59.83 in late trade. That was still down $1.23 from Monday’s close.
New York’s West Texas Intermediate (WTI) for January hit a similar five-year low at $US53.60, but climbed back to 10 cent loss at $US55.79 in midday trading.
Oil prices have plummeted by almost 50 per cent since June, with losses picking up after OPEC’s recent decision to hold its output ceiling in an oversupplied market.
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