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Stock markets across Europe and Asia rallied on Friday to stem some of December’s heavy losses, with London’s FTSE 100 recording its best day for rising share prices since April.
The index of the UK’s most valuable companies closed up 2.3%. BP and Shell were the biggest risers, up 3.5% and 2.3% respectively as oil prices rebounded. Shares in exporters also climbed, led by British American Tobacco, which rose 3.6%.
The FTSE 250, made up of businesses more focused on the UK market rose 2.2%.
European shares also clawed back losses, buoyed by a late bounce on Wall Street on Thursday. The Frankfurt-based Dax rose 1.7% and the Paris CAC 40 1.6%.
Most Asian stock markets took their cue from Thursday night’s late rally on Wall Street. The Shanghai Composite index rose 0.44%, South Korea’s Kospi 0.6% and Australian stocks 1.02%. Japan’s Nikkei closed down 0.3% after jumping nearly 4% earlier in the day.
The Dow Jones was slightly down by Friday lunchtime in New York on a calmer day of trading after three wild sessions this week either side of Christmas Day.
Global stock markets have have declined since early October when it became clear that the US president, Donald Trump, was digging in for a long trade war with China.
The febrile atmosphere in the run-up to Christmas intensified after Trump turned his fire on the Federal Reserve chair, Jerome Powell, accusing him of making a mistake by raising interest rates.
Trump’s refusal to accept legislation to fund government agencies unless it also contained money to build his wall on the US border with Mexico, which led to the partial shutdown of the federal government over Christmas, has added to the mood of uncertainty.
Chris Beauchamp, the chief market analyst at the online trader IG, said traders were finding it difficult to forecast the direction of the US and global economies without any extra economic data and while the political heat was high.
“The bounce of the past few days has taken place while the economic and macro backdrop remains frozen, with little movement on the trade wars, Brexit and now the government shutdown debates that have been such drivers of sentiment and flows over the past year or more,” he said.
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