A basket of European bourses had rallied on Tuesday with Frankfurt’s blue-chip index DAX paring all of the losses for the year, as market participants’ optimisms had been sailing over a bullish wave stemmed from a breakthrough agreement among the EU leaders reached earlier on Tuesday over a massive pandemic stimulus bill aimed at reviving the bloc’s economies from the pandemic induced fiscal downturns.
In point of fact, following a nearly five-day long EU summit, in the early hours of Tuesday, leaders of the bloc’s 27 member states had agreed to a $1.8 trillion pandemic aid package comprising of a €750 billion in pandemic relief bill alongside a €1.1 trillion in EU budgetary aid until end-2027, which eventually had heightened up the investors’ morale all over the globe.
EU pandemic relief bill lifts European stock indices to four-month peak
Aside from that, followed by the reveal of EU pandemic relief bill, which several analysts said could hoist up the ailing eurozone economy much-earlier than anticipated, the regional pan-European STOXX 600 had opened up the day sharply higher and had climbed as much as 1.3 per cent, however, ended down the day with a gain of 0.3 per cent following a brief sell-off at the later part of the day, remarking the index’s highest closing level since early March, while the eurozone’s blue-chip stock index surged 0.5 per cent.
Apart from the EU relief bill, a rally of the crude oil futures’ prices had also added to investors’ prospects, as oil stocks had proffered the heaviest boost in eurozone stock indices and had marked up their best session since early-March as well.
On top of that, encouraging clinical trial results from the pandemic vaccine producers all over the globe had brightened the market momentum further.
Citing statistics, on Tuesday’s European market wind down, London’s FTSE 100 rose by 0.13 per cent to 6,269.73 and French CAC 40 gained 0.22 per cent to 5,104.28, while Frankfurt’s DAX had surged 0.96 per cent to wrap up the day at 13,171.83.
Elsewhere in the Europe, Italy’s FTSE MIB added 0.49 per cent to 20,723.42, while Madrid’s benchmark IBEX 35 soared 0.22 per cent to 7,494.50.
Meanwhile, addressing to an out-and-out optimism over the European shares’ bull-run in a longer-term outlook largely due to the monumental stimulus package, a senior macro strategist at Rabobank, Teeuwe Mevissen said on the day’s European market closure, “It will add to the foundation of the current bull market.
It will have a long-term impact in the sense that if the European Union finds itself in a similar situation in the future, then markets will expect that governments will come to the rescue”.