Sat, 04 Jul 2020

NEW YORK, New York - Optimism about a trade deal between the U.S. and China and increasing hopes Boris Johnson will yet do a deal on the UK leaving Brexit, drove markets higher across Europe and the U.S. on Tuesday.

The British pound jumped to a five-month high, pushing gains since last Thursday, when Irish and UK leaders Leo Varadkar and Johnson first indicated a deal was in the works, to almost 5%.

"If we can resolve the China trade issue and have a reasonably good resolution to the Brexit issue with the UK, it adds a sense of optimism to the market. Combine that with the earnings today being good and happy days are here again," Rick Meckler, a partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey was quoted by the Reuters Thomson news agency as saying on Tuesday.

At the close of trading on Tuesday, the Dow Jones Industrial Average was ahead 237.44 points, or 0.89%, at 27,024.8.

The Standard and Poor's 500 rose 29.53 points, or 1.00%, to 2,995.68.

The Nasdaq Composite advanced 100.06 points, or 1.24%, to 8,148.71.

The British pound rose sharply, topping 1.2800 at one stage. By early Asian trading in Sydney on Wednesday, the pound was changing hands at 1.2768.

The euro rose modestly to 1.1032.

The Jap;anese yen fell to 108.82. The Swiss franc was also weaker at 0.9988.

The Canadian dollar was little changed at 1.3205.

The Australian dollar was sharply weaker at 0.6748. The New Zealand dollar fell to 0.6287.

The German Dax jumped 1.15%, while in Paris, the CAC 40 rose 1.05%.

With some lingering skepticism on Brexit, UK markets remained flat with the FTSE 100 closing down 0.03%.

On Asian markets, the Nikkei 225 rose sharply, adding 408.34 points or 1.87% to 22,207.21 - a six months high.

Elsewhere there was little movement with buyers and sellers evenly divided. China's Shanghai Composite eased 16.84 points or 0.56% to 2,991.05.

In Hong Kong, the Hang Seng slid 17.92 points or 0.56% to 2,991.05.

The Australian All Ordinaries rose 5.40 points or 0.86% to 6,763.30.

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