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Global equities burst higher on trade deal

Global equities burst higher on trade deal

London, Jan 17 (AFP) Global equities rose Friday as investors, still buoyed by a landmark China-US trade deal, turned their focus to the earnings season and the global outlook, while also cheered by Chinese economic data. In early afternoon European trade, London rose 1.0 per cent, Frankfurt jumped 0.7 per cent and Paris added 0.9 per cent, aided by news that China's economy appears to be stabilising.

"Stock markets in Europe are higher this morning as the bullish move in Asia overnight has influenced traders in this part of the world," said CMC Markets analyst David Madden. "China released some broadly positive economic reports, which has boosted sentiment around the globe."

All three main indexes on Wall Street ended at record highs Thursday, boosted by the Senate's approval of a new North American free-trade deal, while Google parent Alphabet joined Apple and Microsoft to become a trillion-dollar firm for the first time. The positive energy funnelled through to Asia, where Hong Kong gained 0.6 per cent, Tokyo ended 0.5 per cent higher, Shanghai rose 0.1 per cent and Sydney added 0.3 per cent.

Apart from last week's blip caused by the US assassination of Iran's top general, markets have enjoyed a strong start to the new decade, building on the rally of late 2019. The gains have been fanned by the "phase one" trade agreement as well as signs of improvement in worldwide economies, lower interest rates, government stimulus and easing Brexit concerns.

And with the prospect of a healthy batch of company reports, there are hopes for further advances. "It's very hard to be bearish here," Linda Duessel, at Federated Investors Management, told Bloomberg TV. "We could have really good earnings surprises to the upside" as more profit reports roll in, she said.

Beijing added to the mood, releasing data that said the world's number two economy expanded 6.1 percent last year. While that is the slowest pace in three decades and well down from 6.6 per cent in 2018, it is in line with expectations and the government's target.

The six per cent growth for October-December was the same as the previous quarter, while traders were also cheered by figures showing a better-than-forecast rise in retail sales, industrial output and investment. The slowdown in growth in China has been a major headache for investors for the past few years as the country's leaders struggle with the US trade war, slowing global demand and a worrying debt mountain.

Still, while there is hope that 2020 could see healthy advances for equities, some doubt remains. (AFP) SCY

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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