European equities rebounded strongly in today’s session. The CAC, DAX, IBEX and the London benchmark index gained between 0.65% and 1.26%, while the euro strengthened against the USD, trading above 1.31.
In London, banks and financial stocks drove the index higher as risk appetite increased after the heavy sell-off in the last few trading sessions. The index today hit a 2-year high as strong gains in financial and energy stocks supported the strong uptrend. Barclays, HSBC and Standard Chartered led the UK banking sector higher after gaining between 1.3% and 2.6%. British Land and Land Securities rose by 1.11% and 0.94%, respectively amid signs of improvement in the UK housing sector.
On the macroeconomic front, UK Markit/CIPS services PMI rose strongly to 60.5 in August compared to 59.1 in July, beating expectations of 58.5. In the US, factory orders surged by 10.5% in July, slightly below expectations of a 11% rise.
Later this evening, investors will be watching closely for the details of the US Federal Reserve Beige Book releases, which could give an insight about the current economic conditions and expectations.