European stocks rally after Easter break, but oil falls below $40 - business live
block-time published-time 8.23am BST
European shares rise after long break
European stock markets have opened higher this morning as traders return to their desks after the Easter break.
The main indices have risen by at least 0.5% at the open, as traders ponder the strength of the recent rally since the turmoil of January and early February.
In
London
, the
FTSE 100 has gained 47 points or 0.8% to 6154, in a fairly broad rally led by financial firms such as
Barclays, Prudential and
Standard Life.The top risers in
London
this morning Photograph:
Thomson Reuters
Investors have had a long weekend to chew over the state of the global economy, from the slowdown in
China
to the deflationary pressures in the eurozone.
But it’s still hard to say whether 2016 will be a good year for shares, given recent weak economic data and geopolitical tensions.
Philip Borkin, a senior economist in
Auckland
at
ANZ Bank New Zealand Ltd, summed up the mood well in a note to clients:
“It is certainly not a global economic backdrop where one could say that a lot of clarity is on offer at present.”
And CMC Markets’ Michael Hewson says there’s little reason for investors to be particularly positive right now:
Over the last couple of weeks European markets have struggled to move meaningfully in either direction, contained by a stabilisation in commodity prices, slightly less concern about the Chinese economy, and commitments to slightly looser policy from the Bank of Japan, European Central Bank and the Peoples Bank of China.
And the oil market continues to be stalked by oversupply fears. That’s pushed the price of Brent crude oil down by almost 1% this morning, back below $40 per barrel.
block-time published-time 8.08am BST
The agenda:
Bank of England stress tests and Port Talbot steel decision
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
It’s a nerve-wracking day for Britain’s steel industry. Top executives at India’s Tata are meeting in
Mumbai
to decide whether to continue supporting its operation in Port Talbot.
The Welsh factory has already suffered deep job cuts, in the face of slumping steel prices. Tata must now decide whether to invest more in the plant to ensure its future, or not.
At 11am BST the Bank of England will announce the details of the stress tests which Britain’s largest banks will face later this year.
The BoE may also signal that it is ready to clamp down on buy-to-let property owners, when it publishes its review of the sector.
A taxi and buses queue outside the
Bank of England in
London
. Photograph:
Luke Macgregor/Reuters
Investors will also be watching for a speech by Janet Yellen, chair of the Federal Reserve, at 4.30pm BST. She may drop some hints about the prospects of US interest rate rises in the coming months.
Chris Weston of IG explains:
The interest rate markets see a further hike in June as a 36% probability, so in theory, Ms Yellen only really needs to acknowledge the improvement in inflation forces and we could see the US dollar rally.
The latest measure of US consumer confidence, due at 3pm BST, could also show whether America could stomach higher interest rates.
We’ll be tracking all the main events through the day...
block-time updated-timeUpdated at 8.27am BST
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