LONDON – A global stocks rally took root Monday after strong US jobs data, and despite Brexit uncertainty that boosted the pound.
Asian and European equities were spurred higher, extending pre-weekend gains, as Friday’s solid jobs report reinforced confidence in the US economy and helped soothe trade war nerves. “European stock markets are higher after a strong finish in Asia,” noted CMC Markets UK analyst David Madden on Monday. “Investors are taking their cues from the Far East, and it seems the sell-off in Asia was overdone in the run up to the tariffs being imposed.” Markets have slumped in recent months on trade war fears, and on Friday Washington rolled out tariffs on $34 billion of Chinese goods, sparking retaliatory measures from Beijing.
The British pound meanwhile rose Monday despite shock news that Prime Minister Theresa May’s Brexit minister David Davis has resigned. Analysts said the news persuaded many investors that Britain could be heading towards a so-called “soft” Brexit. Sterling rose above $1.33 to near its highest level in nearly one month.