LONDON — European stocks rose sharply on Monday as global markets rally on falling U.S. Treasury yields and boosted by positive news on the coronavirus vaccine front.
The pan-European Stoxx 600 jumped 1.7% in early trade, with basic resources adding 2.7% to lead gains as all sectors and major bourses entered positive territory.
The sharp rise for European markets comes after U.S. stock futures rose sharply in overnight trading as Treasury yields continued to retreat from their highs from last week. Stocks had been under pressure over the last few weeks as rising yields made equities look less attractive to investors.
The major averages rose for February, bolstered by a strong earnings season, positive news on the vaccine rollout and hopes of another stimulus package. The House passed a $1.9 trillion Covid relief bill, the American Rescue Plan Act of 2021, early Saturday. The Senate will now consider the legislation.
More positive news on the Covid-19 vaccine front also emerged this weekend as the U.S. Centers for Disease Control and Prevention advisory panel voted unanimously Sunday to recommend the use of Johnson & Johnson‘s one-shot Covid-19 vaccine for people 18 years of age and older. The company expects to ship out 4 million doses initially.
Meanwhile, in Asia-Pacific, stocks traded higher on Monday despite data releases showing China’s manufacturing activity growth slowing in February.
China’s official manufacturing Purchasing Managers’ Index (PMI) for February came in at 50.6 over the weekend, data from the country’s National Bureau of Statistics showed. That was lower than January’s reading of 51.3, but still above the 50 level that separates expansion from contraction.
A private survey released Monday also showed China’s manufacturing activity in February growing at a slower pace.
In Europe Monday, earnings came from Bunzl and Bank of Ireland, and a raft of data releases include manufacturing PMI data, U.K. mortgage approval data and inflation figures from Italy and Germany.
– CNBC’s Maggie Fitzgerald and Eustance Huang contributed to this market report.
Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.