Finance News

European equities rise as cautious Fed fuels sentiment; Nice Britain closed; Suez up 19%

European stocks were higher on Monday as moderate US monetary policy signals boosted global risk-weighted assets.

Most major European stock exchanges rose as global market participants bet that supportive monetary policies will keep stocks boosting despite the economic damage from the coronavirus pandemic.

Last week, the Federal Reserve, which cut interest rates to zero and launched a perpetual asset purchase program to support the economy, set an inflationary framework that would keep interest rates down longer.

In the UK, markets were closed on Monday for a public holiday.

Asia Pacific markets closed broadly higher on Monday, with Japanese stocks leading gains in search of a replacement for longtime Prime Minister Shinzo Abe. News that Berkshire Hathaway had bought shares in five leading Japanese trading companies from Warren Buffett also added to sentiment. The deal is viewed as a long term bet on the global economy.

However, investors continue to watch coronavirus developments as global cases topped 25 million on Sunday. According to Johns Hopkins University, the US, Brazil, and India have the highest numbers of infections, with the US approaching 6 million.

In corporate news, Swiss food and beverage giant Nestle said it was buying US peanut allergy maker Aimmune Therapeutics, adding to its health science portfolio. Nestle shares were slightly higher on Monday morning.

Telecom Italia's shares rose 2.3% on Monday. The Italian state-backed telecommunications company is on the verge of signing a landmark deal with US fund KKR that could form the basis of plans to create a single ultra-fast broadband network, Reuters reported.

French utility Suez stocks rose nearly 19% after Veolia offered to buy a stake in the company, potentially leading to a full takeover.

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