LONDON – European stocks rose sharply on Monday as global markets rallied from falling US Treasury yields and were buoyed by positive news on the vaccine front. coronavirus.
The pan-European Stoxx 600 was up 1.7% in early trading, and core resources added 2.7% to lead gains as all sectors and major exchanges entered positive territory.
The sharp rise in European markets comes after US equity futures rose sharply in overnight trading as Treasury yields continued to decline from their highs last week. Stocks had been under pressure for the past few weeks as rising returns made stocks appear less attractive to investors.
Major averages rose for February, driven by a strong earnings season, positive news about the vaccine launch and hopes for another stimulus package. The House passed a $ 1.9 trillion Covid relief bill, the American Rescue Plan Act of 2021, early Saturday. The Senate will now consider the legislation.
More positive news on the Covid-19 vaccine front also emerged this weekend when the advisory panel of the US Centers for Disease Control and Prevention unanimously voted Sunday to recommend the use of the vaccine. Johnson & Johnson Single Injection Covid-19 for People 18 Years and Older. The company expects to initially ship 4 million doses.
Meanwhile, in Asia-Pacific, stocks traded higher on Monday despite published data showing that growth in China’s manufacturing activity slowed in February.
China’s official manufacturing purchasing managers index (PMI) for February was 50.6 over the weekend, data from the country’s National Bureau of Statistics showed. That was lower than the January reading of 51.3, but still above the 50 level that separates expansion from contraction.
A private survey released on Monday also showed that China’s manufacturing activity in February grew at a slower pace.
In Europe on Monday, earnings came from Bunzl and the Bank of Ireland, and a series of data releases include manufacturing PMI data, UK mortgage approval data and inflation figures from Italy and Germany.
Looking at individual share price movement, British construction company Persimmon and British Airways parent IAG rose more than 5% in early trading to lead Europe’s first-class index.
– CNBC’s Maggie Fitzgerald and Eustance Huang contributed to this market report.
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