ROME: European stock markets have risen strongly as weak US data fuelled talk the US Federal Reserve would not hike interest rates any time soon.
London’s benchmark FTSE 100 index of top companies climbed 2.8 per cent to 6,298.92 points, while Paris’ CAC 40 index jumped 3.5 per cent to 4,616.90 points and Frankfurt’s DAX 30 won 2.7 per cent to 9,814.79.
Madrid shot up 3.8 per cent and Milan added 2.7 per cent.
“European stocks jumped at the start of the week, encouraged by a positive reaction in US markets to the weak US employment report that spawned the biggest daily reversal for the Dow Jones Industrial Average in four years,” analyst Jasper Lawler at CMC Markets said.
The Dow Jones Industrial Average was up 1.1 per cent to 16,656.29 points in midday trading.
The broad-based S&P 500 rose 1.2 per cent to 1,974.15, while the tech-rich Nasdaq Composite Index gained 0.8 per cent to 4,745.06.
Asian indices also took their lead from Friday’s Wall Street surge after a September unemployment report increased the likelihood the US Federal Reserve will keep key interest rates near zero for longer than previously thought.
That boosted stock market sentiment as rising interest rates tend to send markets lower because they increase loan repayments for businesses, while slashing disposable incomes for consumers.
A delay would give global stock markets some breathing space after suffering their worst quarter since 2011.
“Markets had been anticipating that the Federal Reserve would raise rates in December, but Friday’s very weak employment numbers may have thwarted any chance of a 2015 rate rise,” Rebecca O’Keeffe, head of investment at online stockbroker Interactive Investor, said.
