Stocks rebound on easing Trump tax concerns

LONDON: Stock markets rebounded Tuesday, with investors still banking on Donald Trump being able to push through his economy-boosting agenda despite last week's healthcare debacle.

The dollar however struggled to bounce back against major rivals with uncertainty surrounding the pace of future US interest rate rises.

Equities across the world mostly slid on Monday after Trump's repeal of Obamacare fell at the first hurdle as he failed to garner enough votes from his own Republican party, which controls both houses of Congress.

The failure fuelled worries Trump would not be able to drive his much-vaunted tax-cutting, infrastructure spending, deregulation plans, with analysts pointing out it would leave the administration with less cash to pay for such measures.

Hopes for his stimulus plan helped fuel a surge in global markets and in the dollar since the November election.

"The FTSE 100 index has nudged tentatively higher... as Wall Street rebounded off lows following the recent sharp sell off," said Andy McLevey, head of dealing at stockbroker Interactive Investor.

"Whether the momentum can be maintained remains to be seen however as investors remain cautious ahead of the UK government's likely triggering of Article 50 tomorrow."

Prime Minister Theresa May on Wednesday is set to formally notify the European Union of Britain's intention to leave the bloc in a process that has caused a steep plunge in the value of the pound against the euro and dollar.

While equities picked up Tuesday, the dollar remained subdued, sitting at four-month lows against the yen. The euro has meanwhile been buoyed by upbeat data out of the eurozone.

Weighing on the greenback were comments from the head of the Chicago branch of the Federal Reserve Charles Evans that it might only need to raise borrowing costs twice this year considering an uncertain outlook for inflation and Trump's big-spending and tax-cutting agenda.

The yen has climbed more than seven percent against the dollar since the start of the year while the single currency is up about five percent. Even the pound, which was battered last year by Britain's vote to leave the European Union, has risen five percent from its January lows.

The US unit had already been under pressure after Fed boss Janet Yellen said this month that the pace of rate rises would be slower than initially expected.

"The market will be...interested -- or hoping (vainly) for new insights from Fed Chair Yellen's address" later Tuesday, said David de Garis, director of fixed income, currencies and commodities at National Australia Bank.

- Key figures around 1000 GMT -

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London - FTSE 100: UP 0.1 percent at 7,298.64 points

Frankfurt - DAX 30: UP 0.6 percent at 12,070.76

Paris - CAC 40: UP 0.1 percent at 5,020.91

EURO STOXX 50: UP 0.3 percent at 3,446.12

Tokyo - Nikkei 225: UP 1.1 percent at 19,202.87 (close)

Hong Kong - Hang Seng: UP 0.6 percent at 24,345.87 (close)

Shanghai - Composite: DOWN 0.4 percent at 3,252.95 (close)

New York - Dow: DOWN 0.2 percent at 20,550.98 (close)

Euro/dollar: DOWN at $1.0859 from $1.0865

Pound/dollar: UP at $1.2592 from $1.2562

Dollar/yen: UP at 110.68 yen from 110.65 yen

Oil - Brent North Sea: UP 35 cents at $51.09 per barrel

Oil - West Texas Intermediate: UP 37 cents at $48.10

Copyright AFP (Agence France-Press), 2017