Stock markets in Europe opened higher on Tuesday, following the Asian markets’ positive reaction to the US Federal Reserve’s pledges to run an open-ended asset purchase program amid the global coronavirus outbreak.
Britain’s FTSE 100 index surged almost four percent at the start of trading in London. Germany’s DAX is up almost six percent, while France’s CAC gained almost five percent.
The pan-European Stoxx 600 jumped 4.4 percent in early trade, with basic resources growing 6.5 percent as all sectors entered positive territory.
Markets in Asia-Pacific also jumped earlier in the day in reaction to the Fed stimulus announcement, with stocks in Japan and South Korea leading the gains among the region’s major markets.
The US Federal Reserve said on Monday that its stimulus program will run in the “amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”
Over the past month, stock markets around the world have seen historic declines as the coronavirus pandemic has brought much of the global economy to a halt.
The Dow Jones Industrial Average index in the US has fallen over 33 percent in the last 30 days. The S&P 500, an index comprising America’s top 500 corporations, is down 30 percent over the same period, while the Nasdaq Composite lost over 25 percent.
Policymakers have been issuing stimulus funds to blunt the impact of the coronavirus on their countries’ economies.
Eurozone finance ministers are expected to meet via videoconference on Tuesday to discuss the region’s response to the outbreak. There are currently over 383,000 confirmed cases of Covid-19 globally and more than 16,000 deaths.
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