US stocks have risen sharply in early trading as investors take heart in better-than-expected Chinese economic data and as state governors weigh up easing coronavirus lockdowns.
The S&P 500 index was 2.3 per cent higher roughly an hour after the bell. The Dow Jones was up two per cent and the Nasdaq had risen 3.1 per cent.
European bourses were also higher, with the continent-wide Stoxx 600 up one per cent. Germany’s Dax was 1.9 per cent higher and France’s CAC 40 was up one per cent.
Britain’s FTSE 100 was the odd one out, with stocks down 0.7 per cent. The UK government said it has no immediate plans to ease the coronavirus lockdown.
Investors around the world were cheered by Chinese trade data for March that showed an improvement from a weak performance in February.
Imports and exports still fell 0.9 per cent and 6.6 per cent respectively, but these were much better numbers than analysts had predicted.
“Markets continue to react in an odd way, mostly ignoring all the bad figures that have come their way and focusing on the positives, such as the China figures,” said Chris Beauchamp, chief market analyst at trading platform IG.
Beauchamp said the US Federal Reserve’s “extraordinary actions last week continue to be felt”. The Fed moved last week to backstop $2.3 trillion (£1.8 trillion) of lending to bolster small and medium-sized businesses and local governments.
Investors also found comfort in the fact that many governments are weighing up when it is best to reopen their economies.
Spain, which recorded the lowest proportional daily rise in deaths and infections since early March yesterday, has let some businesses reopen. Austria is reopening thousands of shops today.
Andrew Cuomo, governor of the US’s worst-hit state New York, said yesterday that a group of states would start discussions today about lifting lockdown measures. They include New Jersey, Pennsylvania, Connecticut, Delaware and Rhode Island.
Mark Haefele, chief investment officer at UBS Global Wealth Management, said: “Sentiment will zigzag until there is more clarity on formal measures to reopen major economies.”
“More broadly, even though global markets have rebounded, it is difficult to say with any certainty whether the bottom has been reached.”