European stocks rose for a third day in a row as investors dodged fears over the Delta coronavirus variant and instead focused on bets for further monetary support from the European Central Bank.
The Stoxx 600 index opened 0.6 percent higher, after a 1.7 percent rise Wednesday. The regional equity gauge was on track to end the week slightly higher and remained close to its all-time high despite a global market fluctuating on Monday. The FTSE 100 in London has changed plans.
Investors long awaited tthe ECB, at its meeting next Thursday, to signal that it will continue with government debt purchases that have eased borrowing costs for the entire coronavirus crisis after its emergency purchase program in pandemic (PEPP) of 1.85 tonnes will end next year.
Such bond purchase programs increase government debt prices, decrease borrowing costs, and can increase equity valuations by inviting investors to accept lower rates of return or dividends relative to interest rates. stock prices.
“Pandemic rate hikes are leading to markets worrying about the fragility of the economic recovery,” said Zehrid Osmani, trust manager of Martin Currie’s global portfolio. But cool closures or other social constraints lead to “central banks remaining very accommodating,” he said, “which naturally leads you to stock markets in favor of bonds.”
The German government’s 10-year debt yield, which moves inversely to the eurozone’s fixed-income security price, was stable at minus 0.4 percent on Thursday, around its lowest level. since the beginning of February. The 10-year U.S. Treasury yield fell 0.02 percentage points to 1.275 percent.
“Recent data Covid points to another wave of infections, even in countries like the UK that have vaccinated a large portion of their populations,” said Paul Jackson, global head of asset allocation research at Invesco. .
“With this fund, we do not expect the ECB to signal any tightening of policy at the next meeting,” he said, “and we would not be surprised to see some form of implicit easing.”
The euro was firm against the dollar at $ 1.1796, having lost 0.6 percent against the U.S. currency so far this month.
In Asia, Hong Kong’s Hang Seng index rose 1.7 percent and South Korea’s Kospi 200 rose 1.3 percent after strong session on Wall Street driven by strong quarterly earnings from Coca-Cola, advertising group Interpublic and telecommunications conglomerate Verizon.
Futures markets reported that the S&P 500 would gain 0.1 percent in New York’s top businesses while the Nasdaq Composite focused on technology would gain 0.2 percent.
Brent crude, the international crude oil benchmark, fell 0.2 percent lower to $ 72.05 a barrel.