Market Report European Stocks Bounce Asian Intervention
The Asian markets are witnessing a rebound gradually amid optimistic hope that the Ukraine peace deal may emerge soon. European traders seem followingAsia's lead as a jump was seen in the Dax Index of Germany in recent days. Similarly, the French Cac 40 became a favorable opportunity for many.
The Chinese stocks rebounded after a short heavy selling due to Beijing's response to a fresh Covid pandemic outbreak. Experts believe the verbal intervention of the government in protecting volatility could be the key reason.
Simultaneously, the Hang Seng Index of Hong Kong enjoyed the best day in more than a decade and closed higher on March 15 by about 9.1 percent. The Shanghai Composite and Japanese Nikkei 225 Index were significantly up.
All these were reflected in the stocks listed on the London Stock Exchange and having exposure to Asia. An outstanding jump was witnessed in the Scottish Mortgage Investment Trust as it has large holdings of Asian corporate giants including Tencent, a tech giant from China. FTSE 250 reciprocated similarly.
Burberry, one of the most popular luxury fashion brands and has a wide presence in China, jumped over 6 percent at a time lately and nearly the same was witnessed with insurer Prudential.
Mining firms turned optimistic and it is hoped the raw materials could be in great demand with the economic stabilization of China. Antofagasta, Glencore, Rio Tinto and Anglo American added values.
Meanwhile, it is hoped the Russian invasion of Ukraine may soon end up with a peace deal. A hint of peace talks has emerged from the desk of Ukrainian president Volodymyr Zelensky. He is lately sounding more realistic when NATO and other countries have denied taking part in the war directly against Russia.
The Western allies have imposed several sanctions on Russia including a ban on the import of Russian oil and gas and removing the Russian banks from international SWIFT payment systems.
As an aftermath, the prices of Brent crude and gas have jumped high and several countries including the United Kingdom are facing inflation. Prices of food and other necessary items have gone high. It is believed the interest rates may be revised and move upward.
Economists argue if theBang of England increases the interest rates, it may lead to stagflation and urge the government to delay it or use other measures to have control over the rising inflation.
Russia invaded Ukraine on February 24 and the conflict has entered into the fifth week. A good part of the Ukrainian population has been displaced. Several cities have been destroyed and close combat is being reported in the capital Kyiv.