Europe open: Rally continues on China data, Covid vaccine hopes
By Frank Prenesti
Date: Tuesday 01 Dec 2020
(Sharecast News) - European shares made a strong start to Tuesday's session with more optimism over a coronavirus vaccine and positive China data boosting sentiment.
The pan-European STOXX 600 index was up 0.62%, after a record-breaking run in November. London's FTSE 100 rose 1.3%, while the German DAX was up 0.85% and France's CAC 40 climbed 0.78%. US futures were higher, with the Dow Jones up 321 points.
Chinese factory activity accelerated at the fastest pace in a decade in November, according to a private sector survey that the economy was returning to pre-pandemic levels.
The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) rose to 54.9 from October's 53.6, marking the highest level since November 2010.
News that Moderna's Covid-19 vaccine was 94% effective also helped to drive markets upwards. Its treatment along with that of Pfizer/BioNTech are expected to be given emergency use authorisation in the UK, US and elsewhere this month.
However, sentiment was slightly tempered by Brexit talks, where the UK was digging its heels in over the symbolic issue of fishing rights, despite the industry making up a small share of the domestic economy.
In equity news, French real estate investment company Covivio rose almost 6%.
Royal Mail shares were up 3% on an upgrade to 'hold' from 'sell' by Liberum.
UniCredit shares slipped sharply again as CEO Jean Pierre Mustier stepped down, with sources citing a rift with the board over strategy for the sudden departure.
"This is a huge blow to the bank, and in particular raises concerns over its governance and decision making processes. There has been speculation that the Italian government were trying to get Unicredit to buy Monte Dei Paschi, a bank that has been in trouble for years now, and whose balance sheet problems are a huge unknown," said Markets.com analyst Michael Hewson.
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