European Markets Rallied As Investors Cheer U.S. Tax Reform

The European markets ended the first session of the new trading week solidly in positive territory. Investors were thrilled with the approval of a bill to overhaul the U.S. tax system. The news sparked a rally in shares of European bank stocks.

Senate Republicans narrowly approved a massive tax reform bill early Saturday morning. The Senate voted 51 to 49 in favor of the bill known as the Tax Cuts and Jobs Act, with the vote largely coming down along party lines.

With the vote to approve the bill, lawmakers from the Senate and House will need to go to conference to work out differences in the bills passed by the two chambers.

Meanwhile, gains in the FTSE 100 of the UK were more restrained than in the rest of Europe. This was due to a rise in the value of the British pound on reports of a breakthrough in Brexit talks. The U.K. has committed to EU negotiators that there will be no regulatory divergence on the island of Ireland.

The pan-European Stoxx Europe 600 index advanced 0.85 percent. The Euro Stoxx 50 index of eurozone bluechip stocks increased 1.38 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.83 percent.

The DAX of Germany climbed 1.53 percent and the CAC 40 of France rose 1.36 percent. The FTSE 100 of the U.K. gained 0.53 percent and the SMI of Switzerland finished higher by 0.58 percent.

In Frankfurt, Dialog Semiconductor sank 24.30 percent. The company confirmed that it continues to supply Apple Inc. with customized power management integrated circuits across a range of platforms without material change to its ongoing business relationship.

Deutsche Bank jumped 2.12 percent and Commerzbank added 3.02 percent.
In Paris, Airbus rallied 3.00 percent. The aerospace giant estimates that it can deliver more than 700 aircraft to customers in 2017.

Sanofi finished higher by 0.37 percent. The pharmaceuticals giant said no deaths had been reported in the Philippines as a result of the P3.4 billion dengue vaccination program that has been suspended by the government.

Societe Generale gained 2.36 percent and Credit Agricole rose 1.50 percent. BNP Paribas also finished higher by 2.24 percent.

In London, Rio Tinto advanced 1.09 percent after appointing Simon Thompson as its new chairman.

Barclays climbed 2.56 percent and Royal Bank of Scotland rose 1.52 percent. Lloyds Banking Group advanced 0.97 percent and HSBC added 0.42 percent.

Insurer Tryg jumped 3.43 percent in Copenhagen after it agreed to buy unlisted competitor…

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