Despite the slump in the UK and Euro area services sector activity as well as the contraction in the factories, which points towards a recession, the risk-on trading action in the European trading remains unperturbed.
Markets continue to cheer the stimulus measures deployed by the German government and the US Federal Reserve (Fed) to tackle the economic fallout from the coronavirus pandemic. Further, the prospects of the US Congress reaching the economic package deal against the virus spread also added to the renewed optimism across the global markets.
The market mood received a further boost amid signs of a likely slowdown in the virus spread in Italy, the new epicenter of the outbreak. Italy’s new coronavirus cases fell for a second day to near 700, slightly less than the previous day.
Subsequently, S&P 500 futures extend the rally by 5% and hit the limit-up band of 2,333.50. Among the European indices, the pan-European benchmark, EuroStoxx 50 is up 5.80%, Germany’s DAX rises 6.50% while the UK’s FTSE 100 jumps 4% and French CAC 40 gains nearly 4% so far this session.
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