LONDON – European equities advanced on Tuesday morning, with market attention focusing on the global economic recovery and the last meeting of the US Federal Reserve.
The pan-European Stoxx 600 rose 0.5% at the start of the negotiations, with cars rising 1.9% to lead the gains, while oil and gas inventories fell 0.4%.
The market’s focus is on the Federal Reserve, which starts its two-day meeting on Tuesday, followed by a statement and briefing by President Jerome Powell on Wednesday.
An increase in interest rates and a recovery in the US economy have put easy central bank policies in the spotlight and market watchers have wondered when the Fed might consider reversing those policies.
Later this week, the Bank of England is due to meet on Thursday and the Bank of Japan will also start its two-day policy meeting that day.
Asia-Pacific markets rose on Tuesday, after a relatively moderate start to the week of global trading, with investors anticipating the Fed meeting. US stock index futures were mixed in pre-market trading on Tuesday Friday, after the Dow and S&P closed at record highs amid optimism with the economic reopening.
News about the coronavirus vaccine remains in focus in Europe after Germany became the last country to stop using the AstraZeneca-University of Oxford vaccine due to problems with blood clots. The German government also said it was suspending its use as a precaution, with the vaccine regulator, the Paul Ehrlich Institute, calling for further investigation.
The World Health Organization, health experts and the vaccine manufacturer have all sought to minimize ongoing safety concerns, saying there is currently no evidence to suggest a link between the injection and an increased risk of developing blood clots. The European Medicines Agency is conducting investigations.
Greater movements
The gains on Tuesday came from VW, RWE, Zalando and Greggs on Tuesday.
Volkswagen has a target of 5% -6.5% operating margin this year and 7% -8% in the following years, as it aims to cut costs and an ambitious expansion in the electric vehicle market.
“In the next 15 years, we will see a total turnover in the industry. Electric cars are taking the lead and so software really becomes the main driver of the industry,” CEO Herbert Diess told CNBC on Tuesday.
Shares in the world’s second-largest automaker gained 4.5% in early trading, while German car battery maker Varta jumped 6.5% to lead the Stoxx 600.
Zalando and the French telecommunications company Iliad gained more than 5% after strong results throughout the year.
At the bottom of the European blue chip index, the German biotechnology company MorphoSys plummeted more than 11% after its earnings report.
Subscribe to CNBC PRO for exclusive insights and analysis, and live weekday scheduling around the world.