European stocks rallied early on Wednesday as the re-election of U.S. President Barack Obama fuelled expectation the Federal Reserve’s loose monetary policy will continue.
At 0900 GMT, the FTSEurofirst 300 index of top European shares was up 0.4 percent at 1,119.38 points, after hitting a two-week high of 1,120.30.
Despite Obama’s victory, the balance of power in the U.S. Congress stayed mostly unchanged, keeping intact the risk of a standoff in the “fiscal cliff” talks.
If a deal is not reach, about $600 billion in spending cuts and tax increases are set to be automatically triggered at the end of the year, which investors fear will derail the U.S. recovery.
“(Obama’s victory) certainly brings visibility on U.S. policy, which is positive for markets. Now the focus moves on to the fiscal cliff,” a Paris-based equity and exchange-traded fund trader said.
“With no big shift of power in Congress, will Obama manage to get a deal? That’s the question.” Around Europe, UK’s FTSE 100 index was up 0.3 percent, Germany’s DAX index up 0.4 percent, and France’s CAC 40 up 0.7 percent.
The euro zone’s Euro STOXX 50 index was up 0.6 percent at 2,550.76 points, but was losing steam after hitting a strong resistance level representing the descending trendline formed by September and October highs.
The chart for the blue-chip index shows a bullish symmetric triangle pattern shaping up since mid-September, with the index trading in a tightening range, signalling that a break above the triangle could quickly send the index rallying to March levels.
Aurel BGC chartist Gerard Sagnier warned however that trading volumes have been too anaemic to confirm any technical patterns at the moment.
“European indices are in triangles started in mid-September, but there’s isn’t much visibility and volumes are minimal,” he said.
“I think that the trend for the last part of the year, if we get one, will come from the S&P 500. For now, this is still a neutral market.”
Spanish telecoms company Telefonica gained 1.8 percent after saying it expects to meet year-end targets and pledged to pay a dividend in 2013.
- 1Orthodox Jew ‘repeats’ Jerusalem Gay Pride stabbing attack
- 2Ukraine: Civilians killed in shelling amid fragile truce
- 3Migrant crisis becomes hot political issue in Britain and France
- 4Palestinian toddler killed in ‘terrorist’ arson attack, says Israel
- 5Greek PM suggests party referendum to overcome split in Syriza
- 1euronews live TV - News | euronews : the latest international news as video on demand
- 2Russia unveils ‘straight’ flag, internet responds
- 3Seven reasons why Yanis Varoufakis is now a political legend
- 4Greek crisis: ‘Agreement reached’ after marathon talks
- 5International news | euronews, latest international news
- 6Nasa announces the discovery of an earth-like planet
- 7Is Saudi Arabia outlawing rainbows for being gay?
- 8Pluto: New Horizons space probe provides closest-ever pictures
- 9French actor Gérard Depardieu ‘a threat to Ukraine national security’
- 10Latest News Bulletin
- 11BREAKING: Formal nuclear deal reached with Iran, says diplomat
- 12International breaking news | euronews online world breaking news in video
- 13Greece votes ‘No’ in overwhelming rejection of bailout proposals
- 14Berlusconi linked with a shock return to government – in Russia!
- 15At least 10 dead in explosion in Turkish town close to border with Syria
- 16Greece clinches deal with eurogroup after marathon talks
- 17‘Imposed’ bailout deal must be implemented, says Greek PM
- 18Israel angry as Iran and West talk up nuclear deal
- 19Varoufakis resigns after Greek referendum
- 20European Union News | euronews: latest breaking news and headlines about European Union
Latest world news
MH370 suspected flaperon arrives for idenification at BEA, Toulouse
Scuffles at British side of Channel Tunnel in Kent over Calais migrants
Aung San Suu Kyi welcoms Angela Jolie to Myanmar
West Bank: Hundreds attend funeral for Palestinian protester amid increased tensions
Trans-Pacific Partnership talks fail to deliver regional trade deal
Wires > News
- 20:11 CET Kurdish militia in Syria accuses Turkey of ‘provocative’ attacks
- 18:19 CET Egypt extends for six months military mandate in Gulf, Red Sea
- 18:03 CET Iran’s parliament has no power over nuclear deal, top negotiator…
- 17:29 CET Merkel to run for 4th term in 2017 – Der Spiegel
- 17:17 CET Dutch activists call for Caribbean Netherlands to adopt gay rights
- 17:09 CET Iraq’s Barzani condemns Turkish bombing he says killed civilians
- 16:34 CET Myanmar leader goes to disaster zones as floods batter countryside
- 16:21 CET Airplane debris arrives in France for Malaysia crash investigation