Global stock markets rise from the dead as Halloween surge raises spirits
Global stock markets have risen from the dead as a Halloween surge treated investors at the end of a terrifying month of losses.
The FTSE 100 climbed 1.6 per cent to a three-week high on Wednesday to raise spirits after an October which has spooked investors.
The pan-European STOXX 600 index rose 1.7 per cent and the German DAX was up 1.5 per cent as stocks across the continent bounced back.
The rally had started with the Shanghai Composite which closed 1.3 per cent up and Japan's Nikkei closing 2.16 per cent up.
US stock markets joined the party – the Dow Jones rising 1.5 per cent and 370 points after the first hour of trading and the S&P 500 also climbed 1.6 per cent in early trading.
Despite the gains global markets were still down more than eight per cent for the month, according to the MSCI World Index of shares in 47 countries, on track for its worst month since 2012.
A global equity bloodbath earlier in the month had plunged the FTSE 100 to a six-month low after a sell-off in the US spread across the world.
Analysts speculated over whether the buoyant trading session was a prelude to a full-blown recovery.
“Even after this morning's gains global equity markets are left licking their wounds after a brutal month,” David Cheetham from XTB said.
“The recent stabilisation is a pleasing development at least and with positive seasonality often seen in US stocks following the Midterms this latest rise could yet be more than a dead cat bounce and may well lead to a sustained recovery.”
“Ultimately I’m still of the belief that we are in for more downside and rallies are for selling, but squeezes in bear markets are not normally comfortable affairs,” said Neil Campling, co-head of the global thematic group at Mirabaud Securities.
"I think a 2-3 day battle toward the top of the downtrend. Then we can return to the bigger picture – the mid-terms (U.S. elections), trade wars, rates etc," he added.