AIRLINK 75.65 Increased By ▲ 1.95 (2.65%)
BOP 4.90 No Change ▼ 0.00 (0%)
CNERGY 4.43 Decreased By ▼ -0.09 (-1.99%)
DFML 43.58 Decreased By ▼ -1.30 (-2.9%)
DGKC 84.66 Decreased By ▼ -0.84 (-0.98%)
FCCL 21.30 Decreased By ▼ -0.10 (-0.47%)
FFBL 32.49 Decreased By ▼ -0.02 (-0.06%)
FFL 9.53 Decreased By ▼ -0.06 (-0.63%)
GGL 10.09 Decreased By ▼ -0.18 (-1.75%)
HASCOL 6.98 Decreased By ▼ -0.15 (-2.1%)
HBL 114.59 Decreased By ▼ -0.11 (-0.1%)
HUBC 139.20 Increased By ▲ 0.10 (0.07%)
HUMNL 12.15 Decreased By ▼ -0.27 (-2.17%)
KEL 4.97 Decreased By ▼ -0.06 (-1.19%)
KOSM 4.40 Decreased By ▼ -0.05 (-1.12%)
MLCF 37.22 Decreased By ▼ -0.38 (-1.01%)
OGDC 134.26 Decreased By ▼ -2.54 (-1.86%)
PAEL 25.31 Decreased By ▼ -0.08 (-0.32%)
PIBTL 6.64 Decreased By ▼ -0.05 (-0.75%)
PPL 119.33 Decreased By ▼ -1.67 (-1.38%)
PRL 26.38 Decreased By ▼ -0.21 (-0.79%)
PTC 13.79 Decreased By ▼ -0.31 (-2.2%)
SEARL 56.93 Decreased By ▼ -0.37 (-0.65%)
SNGP 66.90 Decreased By ▼ -1.10 (-1.62%)
SSGC 10.40 Decreased By ▼ -0.02 (-0.19%)
TELE 8.32 Decreased By ▼ -0.13 (-1.54%)
TPLP 10.92 Decreased By ▼ -0.06 (-0.55%)
TRG 62.89 Decreased By ▼ -0.45 (-0.71%)
UNITY 27.10 Increased By ▲ 0.05 (0.18%)
WTL 1.36 Decreased By ▼ -0.02 (-1.45%)
BR100 7,919 Decreased By -21.9 (-0.28%)
BR30 25,411 Decreased By -237 (-0.92%)
KSE100 75,395 Decreased By -122.7 (-0.16%)
KSE30 24,204 Decreased By -74 (-0.3%)

europe-1LONDON: European shares, oil and gold rose strongly on Wednesday after US politicians struck a long-awaited deal to avoid a fiscal crisis, while safe-haven dollar and German government bonds fell.

 

Lawmakers approved a plan to prevent huge tax increases and delay spending cuts that together would have pushed the world's largest economy off the "fiscal cliff" and into a likely recession.

 

European markets followed their Asian counterparts and rallied on the news, while futures markets pointed to Wall Street doing the same.

 

London's FTSE, Frankfurt's DAX and CAC 40 in Paris opened between 1.4-1.9 percent higher, pushing the pan-European FTSEurofirst 300 up 1.3 percent and the MSCI world index 0.8 percent.

 

"This is great news for global growth and explains why shares and other growth-related assets are up strongly today," said Shane Oliver, strategist at AMP Capital.

 

Although the US deal is not as far-reaching as markets had wanted, Tuesday's approval by the House of Representatives of a plan already backed by the Senate allayed fears that Republican objections to the heavy emphasis on taxes rather than spending cuts could have scuppered an agreement.

 

Assets which are traditionally see as more risky rose across the board with crude oil futures up 1.1 percent, gold gaining $7 an ounce and copper futures in London up 1.7 percent.

 

In currency markets the euro rose to $1.3281 as the dollar fell 0.5 percent against a basket of major currencies .

 

The Japanese yen also continued its slide, hitting its lowest level since July 2010, as investors bet that the Bank of Japan would have to take ever-more aggressive easing steps to support the economy and satisfy the new government.

 

The pattern was the same for bonds, where prices of higher-yielding Spanish and Italian government bonds rose and the German equivalent, usually favoured by risk-averse investors, fell. The Bund future was last 89 ticks down at 144.75.

 

"The compromise is supportive for risk sentiment as we've seen in a few markets already and it should weigh on Bunds which should correct in line with (US) Treasuries. Treasuries could even underperform," said Rainer Guntermann, a strategist at Commerzbank.

Center>Copyright Reuters, 2013

Comments

Comments are closed.