Markets rise over optimism on US tax reform and euro area economic growth

On Wednesday stocks in Europe gained, following equities from the U.S. to Asia higher as optimism over U.S. tax reform and euro-area economic growth overshadowed concerns about North Korea’s latest missile launch. The British pound strengthened after the U.K. cleared a major Brexit hurdle.

The Stoxx Europe 600 Index headed for a three-week high, with banks outperforming after Federal Reserve chair nominee Jerome Powell signaled he won’t add to financial regulations. Retailers got a leg up after the strongest euro-zone confidence data since 2000 underscored the region’s economic resilience. The euro pared gains even as data from Germany’s states showed inflation accelerating.

In the U.K., gilts dropped and sterling jumped to a two-month high as investors brought forward their expectations for the next interest-rate increase by the Bank of England after Brexit negotiators agreed to an outline divorce deal. The FTSE 100 stock index fell the most in three weeks.

And in the U.S., the Senate tax bill is headed for a marathon debate this week after the budget committee voted Tuesday along party lines to send the Republican plan to the floor.

The Stoxx Europe 600 Index increased 0.7 percent as of 7:11 a.m. New York time, the highest in almost three weeks. The U.K.’s FTSE 100 Index decreased 0.6 percent, the largest dip in almost three weeks. Germany’s DAX Index gained 0.7 percent. Futures on the S&P 500 Index advanced 0.1 percent to the highest on record. The Topix index gained 0.8 percent at the close in Tokyo and the Nikkei 225 Stock Average rose 0.5 percent, while Hong Kong’s Hang Seng Index was down 0.2 percent. The MSCI Asia Pacific Index rose 0.3 percent.

Elsewhere, crude oil fell for a third day as U.S. inventories expanded before OPEC meets to decide on prolonging supply cuts past the end of March. Industrial metals extended a slide.

This article was compiled by BOV Asset Management Limited, a member of the BOV Group. BOV Asset Management,TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000. Email: infoassetmanagement@bov.com Internet address: www.bovassetmanagement.com. BOV Asset Management is licensed by the MFSA.