European shares hit their best level in 15 months on Thursday helped by the Dutch election and the laid back approach by the Federal Reserve.
ADVERTISEMENTEuropean shares hit their best level in 15 months on Thursday and the main stock market index in Amsterdam reached a nine-year high.
Investors hit the buy button, spurred on by the political events in the Netherlands and the laid back approach by the US central bank – the Federal Reserve – to winding down stimulus, which pushed down the value of the dollar and boosted banking shares.
In Frankfurt, analyst Robert Halver of Baader Bank said: “The markets are relaxed for two reasons: first, the Dutch voted in favour of Europe which definitely helps the European atmosphere. I am convinced the French will also vote the same. The other issue is that the US rate increase happened as expected. The rate hike is being interpreted as the US economy doing better than expected. So, a rate hike is acceptable. But much more important is that Fed Chair Janet Yellen made it clear we shouldn’t worry about more rate increases any time soon.”
The Fed raised rates for the second time in three months on Wednesday as expected but did not flag any plan to accelerate its outlook for monetary tightening.
Underscoring the strength of the US economy, the latest data showed homebuilding jumped in February and weekly unemployment benefit claims dropped.
But on Wall Street healthcare companies shares slipped as President Trump’s budget plans signaled higher regulatory costs for the sector and less government funding for medical research.
