LONDON – European equities rose Tuesday morning as market attention focused on the global economic recovery and the latest meeting of the US Federal Reserve.
The pan-European Stoxx 600 added 0.5% at the start of trading, with cars rising 1.9% to make a profit, while oil and gas shares fell 0.4%.
Market focus is on the Federal Reserve starting its two-day meeting on Tuesday, followed by a statement and briefing by Chairman Jerome Powell on Wednesday.
Rising interest rates and a downturn in the US economy have put the central bank’s easy policies in the spotlight, with market watchers questioning when the Fed might consider closing the policy.
Later this week, the Bank of England will meet on Thursday and the Bank of Japan will also begin its two-day policy meeting that day.
Asia-Pacific markets rose higher on Tuesday after a relatively subdued start to World Trade Week as investors look ahead to the Fed meeting. The US stock index futures contract was mixed in pre-trading on Tuesday after the Dow and S&P closed at a record high amid optimism about the economic reopening.
The news about coronavirus vaccines remains in focus in Europe after Germany on Monday became the latest country to suspend the use of the AstraZeneca University of Oxford vaccine due to blood clot problems. The German government has also said it is suspending its use as a precautionary measure, and the vaccine regulator, the Paul Ehrlich Institute, is calling for further investigations.
The World Health Organization, health experts and the vaccine manufacturer have tried to downplay the ongoing safety issues, saying there is currently no evidence to suggest the link between the shot and an increased risk of developing blood clots. The European Medicines Agency is conducting investigations.
Biggest movers
The earnings Tuesday was Tuesday from VW, RWE, Zalando and Greggs.
Volkswagen is aiming for 5% -6.5% this year and 7% -8% in the following years, as it takes into account cost savings and an ambitious expansion in the electric vehicle market.
“Within the next 15 years, we will see a total turnover in the industry. Electric cars are taking the lead and then software will become the core of the industry,” CEO Herbert Diess told CNBC on Tuesday.
Shares of the world’s second largest carmaker reached 4.5% early trading, while German car battery maker Varta jumped 6.5% to lead the Stoxx 600.
Zalando and French telecommunications company Iliad both achieved more than 5% after strong annual results.
At the bottom of the European blue-chip index, German biotechnology firm MorphoSys plunged more than 11% after its earnings report.
Sign in to CNBC PRO for exclusive insights and analysis, and live workday programming from around the world.