Stocks Gain in Europe & Mixed in US

London, March 3 (AFP/APP): European stock markets rose Wednesday as investors snapped up bargain shares following sharp losses last week, but Wall Street was mixed after poor jobs numbers.

London’s benchmark FTSE 100 index finished the day 0.9 percent higher after investors welcomed the government’s latest budget. Frankfurt rose 0.3 percent and Paris climbed 0.4 percent.

“After a couple of days of gains, the bullish sentiment in European equities has run out of steam,” said market analyst David Madden at CMC Markets UK. “The major indices started off in rude health, the DAX 30 set a record high, while the CAC 40 hit its highest mark in over one year, but markets have drifted lower since,” he added.

He pointed to a rise in government bond yields again dampening appetite for equities. Stock markets suffered a sharp sell-off last week on the back of rising US Treasury yields, an indication of rising interest rates. And while the bond market has steadied this week, traders remain cautious over concerns about asset bubbles — and a potential surge in inflation that could herald interest rate hikes in the long run.

British taxes and breaks

In London, British finance minister Rishi Sunak presented the government’s budget which includes plans to ramp up tax on company profits to 25 percent from 2023 as it tries to tackle surging debt taken on to prop up the economy during Covid-19 lockdowns. But a special tax break on business investments helped sweeten the fiscal medicine, and could encourage firms to ramp up spending. Sunak had said on Tuesday that he will extend his multi-billion-pound furlough scheme paying the bulk of wages for millions of private-sector workers.

Hospitality, travel and real estate firms rallied as Britain looks to reopen its shattered economy, which tanked almost ten percent last year. The pound, which sat just underneath $1.40 before the budget announcement, pulled back after the government cut back its 2021 growth forecast to 4.0 percent from 5.5 percent, before bouncing back.

Disappointing US jobs numbers

Wall Street was mixed in late morning trading, with the Dow adding 0.5 percent, but the broader S&P 500 was flat and tech-heavy Nasdaq Composite slid lower. Payroll firm ADP said that private firms in the US added only 117,000 jobs in February. That was much lower than the 180,000 expected by analysts and down from a gain of 195,000 in January, suggesting a forecast rebound in the US economy along with widespread vaccination may be slower to arrive. Investors will be looking for jobs numbers from the US government on Friday to get a clearer picture of the trends in the jobs market.

Oil prices advanced strongly on the eve of a key OPEC+ producers’ meeting. Asian equities rose strongly Wednesday following losses the previous day, as investors track global progress in fighting the deadly pandemic. Bitcoin rallied back above $50,000 on increasing investor risk appetite, but remained below recent record heights.

Key figures around 1630 GMT