By Peter Nurse
Investing.com - European stock markets traded higher Tuesday amid continued enthusiasm over the progress towards a coronavirus vaccine and greater clarity over the transition of power in the U.S. A strong rebound in the German economy has also helped.
At 3:40 AM ET (0840 GMT), the DAX in Germany traded 0.6% higher, the CAC 40 in France rose 0.9%, while the U.K.'s FTSE index climbed 0.6%.
Emily Murphy, the General Services Administration head, on Monday effectively acknowledged Joe Biden as the winner of the presidential election, three weeks after the event, saying he could have briefings and funding to ease his transition into the role.
Uncertainty over whether there would be an orderly transfer of power in the largest economy in the world had weighed on the markets to a certain extent since the Nov. 3 election.
However, the dominant driver of late has been the progress in the search for a vaccine for the Covid-19 vaccine. On Monday, AstraZeneca (NASDAQ:AZN) announced its candidate had an efficacy of up to 90% in certain doses, the third potential vaccine after similarly positive news from Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA).
Germany’s third-quarter GDP rose 8.5% on the quarter according, a recovery from the historic 9.7% fall in the previous quarte. The numbers were revised upward from an initial estimate of 8.2%, with the stronger-than expected rebound mainly driven by higher household spending and soaring exports.
More timely data reflected the recent slowdown in the economy better. The November Ifo business climate index fell to a four-month low, while Insee's estimate of French business confidence fell to a five-month low. However, neither index fell as much as expected.
In corporate news, Compass Group (LON:CPG) stock rose 5% after the catering giant was able to return to profit in its fiscal fourth quarter after a difficult year, hit hard by the pandemic.
Also climbing Tuesday were oil and gas stocks, as crude prices continued to post gains, with the Brent contract climbing to levels not seen since March, as further positive Covid-19 vaccine news pointed to a reasonably prompt recovery in oil demand.
Crude oil supply data from the American Petroleum Institute are due later in the day.
U.S. crude futures traded 0.7% higher at $43.38 a barrel, while the international benchmark Brent contract rose 0.5% to $46.28. Both oil benchmarks settled up about 2% on Monday after gaining about 5% last week.
Elsewhere, gold futures fell 0.7% to $1,824.15/oz, dropping to its lowest level in four months, while EUR/USD traded 0.3% higher at 1.1877.