European stocks extended the new year rally on Tuesday with economy-sensitive travel, retail and commodity stocks leading the gains on fresh signs that the Omicron virus variant might be less severe than initially feared.
The pan-European Stoxx 600 index rose 0.6 per cent to 492.42 by 0809 GMT, hitting a record high after Wall Street’s S&P 500 and Dow closed at all-time highs overnight.
The travel and leisure index jumped 2.5 per cent to its highest in more than six weeks. Airlines Ryanair, British Airways-owner IAG and Wizz Air gained between 6 per cent and 8 per cent.
London’s Ftse 100 rose on Tuesday in the first trading session of the year after its best yearly gain in five years following signs that the Omicron coronavirus variant was less likely to derail the global economic recovery.
The blue-chip Ftse 100 gained 1.1 per cent at 0805 GMT, hitting new highs since February 2020, while the domestically focussed mid-cap index advanced 1.2 per cent.
Financials led gains, with banking and life insurance stocks adding 1.9 per cent and 0.9 per cent.
The Ftse 100 gained 14.3 per cent in 2021, recording its best annual performance since 2016, helped by gains in commodity-linked and industrial stocks.
British retailers gained 2.4 per cent, tracking global sentiment, even though footfall in shops in the days after Christmas was 24.5 per cent lower than the same week in 2019, Springboard analysts said.
Focus will be on key consumer credit, mortgage and manufacturing data later in the day.
Amigo Holdings fell 3.1 per cent after the subprime lender said it had redeemed early £184.1 million (€219.4 million) worth of senior notes due in 2024, as part of a new rescue plan laid out last month.
Britain's vaccine minister said people being hospitalised with Covid-19 in the United Kingdom were broadly showing less severe symptoms than before.
French Finance Minister Bruno Le Maire said although the surge of the fast-spreading Omicron variant was disrupting some sectors, there was no risk of it “paralysing” the economy, and stuck to a forecast of 4 per cent growth for France’s GDP in 2022. – Reuters