European stocks rally at open177 views
London (AFP) – Europe’s main stock markets rallied in opening deals on Tuesday, rebounding from recent Brexit-driven heavy losses as investors picked up bargain shares.
London’s benchmark FTSE 100 index won 2.0 percent to 6,103.82 points, accelerating initial gains, while Frankfurt’s DAX 30 added almost 2.1 percent to 9,458.38 points and the Paris CAC 40 jumped nearly 2.3 percent to 4,074.36.
“Today’s rebound is likely just investors searching for the lows,” Spreadex analyst Connor Campbell told AFP.
“As none of the chaos induced by last Friday is anywhere near going away: the country is still without its next prime minister, the Labour party is in disarray, and the actual process to exit the EU has not even begun.”
He added: “This may well be a dead cat bounce, but one imagines given the state they are in, the global markets will welcome any respite they can.”
A “dead cat bounce” is a market term referring to a rebound briefly interrupting a prolonged market downturn.
Asian equities meanwhile brushed off big early losses Tuesday and the pound bounced as traders began betting on stimulus measures to mitigate the effects of Brexit.
World stock markets had plunged on Monday, extending Friday’s dizzying losses following Britain’s shock referendum decision to quit the European Union.
Britain’s shock June 23 referendum to abandon the EU wiped $2.1 trillion off international equities on Friday.
The surprise decision also sparked the resignation of British Prime Minister David Cameron, who will stand down in the autumn and hand responsibility for exiting the EU to his — as yet unknown — successor.
Meanwhile, opposition Labour leader Jeremy Corbyn has faced mounting criticism of his role in the Brexit crisis, with more than half his top team resigning. He was widely blamed for failing to rally the party’s core working-class vote base to support the “Remain” campaign.