Stock markets surge, pound in focus

The face of Queen Elizabeth II is seen on rolled ten, twenty, and fifty pound sterling banknotes in this arranged photograph taken in London, U.K. Photographer: Simon Dawson/Bloomberg
The face of Queen Elizabeth II is seen on rolled ten, twenty, and fifty pound sterling banknotes in this arranged photograph taken in London, U.K. Photographer: Simon Dawson/Bloomberg

Global markets surged ahead Monday, as bargain-buyers moved in following sell-offs triggered by virus spikes and the reimposition of economically damaging containment measures.

As the coronavirus death toll topped one million, the World Health Organization warned that figure could double without more global collective action.

But major indices took little notice as the Dow Jones and the tech-rich Nasdaq both added around 1.5% minutes after the opening bell.

Despite the swirling clouds of Brexit uncertainty, London added 1.8% while Frankfurt and Paris were more than 2% ahead two hours from the end of the European session.

"Investors appear to be warming towards equities and other risk assets again," said Fawad Razaqzada, market analyst with ThinkMarket.

"The relatively low Covid-linked deaths mean investors are not showing too much concern towards rising virus cases. Instead, they remain optimistic over the potential approval of a vaccine soon, which together with ongoing central bank support will probably help accelerate the recovery," Razaqzada added.

Elsewhere, investors kept an eye on Monday's resumption of trade talks between Britain and the European Union, hoping for a breakthrough despite feuding over a controversial UK bill that threatens to scupper a deal.

The pound rallied against the dollar and euro before falling back slightly on optimism surrounding the latest talks - and after a Bank of England official dismissed talk of possible negative interest rates to boost the UK economy.

Traders were also awaiting the first US presidential debate this week, which could prove crucial in determining November's election, with many worried that a close vote might mean the result is delayed or even challenged by the loser.

On the corporate front, HSBC shares surged more than eight percent in London following news that its biggest investor Ping An Insurance Group had increased its stake in the bank.

Shares in steel giant ArcelorMittal soared almost nine percent after the firm said it would merge its US operations with producer Cleveland-Cliffs.

Key figures around 13:45 GMT 

New York - Dow Jones: UP 1.5% at 27 571.57

London - FTSE 100: UP 1.8% at 5 944.66 points

Frankfurt - DAX 30: UP 2.8% at 12 814.80

Paris - CAC 40: UP 2.2% at 4 832.14

EURO STOXX 50: UP 2.5% at 3 213.88

Tokyo - Nikkei 225: UP 1.3% at 23 511.62 (close)

Hong Kong - Hang Seng: UP 1.0% at 23 476.05 (close)

Shanghai - Composite: DOWN 0.1% at 3 217.53 (close)

Pound/dollar: UP at $1.2882 from $1.2739 at 2030 GMT on Friday

Euro/pound: DOWN at 90.65 pence from 91.23 pence

Euro/dollar: UP at $1.1678 from $1.1626

Dollar/yen: DOWN at 105.48 yen from 105.59 yen

West Texas Intermediate: UP 0.5 percent at $40.44 per barrel

Brent North Sea crude: UP 0.4 percent at $42.11 per barrel

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