Economy

European markets close strong; US extends rally

Italy's FTSE MIB performs best, gaining 1.44%; Dow up more than 400 points in US

Ovunc Kutlu   | 22.09.2021
European markets close strong; US extends rally

ANKARA

European stock exchanges closed strong Wednesday for a second consecutive day, recovering from massive losses recorded on Monday.

The STOXX Europe 600, which includes around 90% of the market capitalization of the European market in 17 countries, was up 4.52 points, or 1%, to close at 463.20.

London's FTSE 100 gained 102 points, or 1.47%, to 7,083, and Germany's DAX 30 index rose 158, or 1.03%, to 15,506 points.

The French CAC 40 added 84 points, or 1.3%, to 6,637, while Spain's IBEX was up 52 points, or 0.6%, to 8,808 points.

Italy's FTSE MIB was the best performer, gaining 364 points, or 1.44%, to 25,717.

Indices declined between 1.2% and 1.6% on Monday amid risks surrounding China's Evergrande Group and the upcoming US Federal Reserve meeting, but they recovered more than 1% on Tuesday.

The Fed meeting that will conclude at 2 p.m. EDT may signal an interest rate hike in late 2022, and the start of tapering -- the process of reducing accumulating $120 billion monthly assets on its balance sheet -- next month.

China's second-largest property developer, Evergrande Group, which has $300 billion in liabilities that could default on its debt and cause millions of customers to lose deposits, earlier said it will make a payment due Thursday on a 4 billion yuan ($620 million) bond that has a 5.8% interest rate, adding that details were "settled in negotiations outside the market."

US extends rally

After plummeting around 2% on Monday and failing to recover Tuesday, US indices opened strong and extended their rallies hours before the conclusion of the Fed meeting.

The Dow Jones rose to 34,349 points with a 431-point jump, or 1.27%, gain at 12.44 p.m. EDT (1644GMT).

The S&P 500 was up 50 points, or 1.15%, to 4,404, while the Nasdaq increased 148 points, or 1%, to 14,895.

The VIX volatility index plummeted 11.7% to 21.50 after jumping to the 28.79 level on Monday.

The yield on 10-year US Treasury notes reversed course and fall 0.74% to 1.314%, as did the dollar index that fell 0.07% to 93.14.


Recovery was also seen in precious metals with gold rising 0.2% to $1,778 per ounce and silver adding 1.9% to $22.91.

Oil prices were up with Brent crude trading at $76 per barrel with a 2.2% gain, while US benchmark West Texas Intermediate was at $72.14 with a 2.3% increase.

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