European shares rise as investors bet on Biden
The U.S. election is far from a done deal.
But investors in Europe on Tuesday (November 3) were placing their bets.
European shares extended their recovery rally with coronavirus worries temporarily on the back burner.
Attention instead shifted to the likelihood of a Joe Biden presidential win.
Analysts say a victory for the Democrat would be considered supportive for European equities.
That's on expectations of a bigger stimulus package and better trade ties with the U.S.
Michael Hewson is Chief Market Analyst at CMC Markets:
"At the moment, the markets are pricing in an optimal outcome - Biden win, senate win. Of course, if that doesn't happen get prepared for a little bit of a correction. And, I think, as opinion polls and results start to come out, you will see an awful lot of volatility over the next 24 hours as markets ebb and flow on the back of the results as they come in. But at the moment, an optimal outcome has been priced in."
The pan-European STOXX 600 index rose 1.8% early on, bouncing off five-month lows hit last week over concerns about new lockdowns.
Growth-sensitive sectors such as oil and gas, miners, banks and automakers led the rally - all rising more than 2%.
Among individual stocks, French bank BNP Paribas gained 6.4% as a surge in currency and commodity trading helped it beat quarterly profit expectations.
Heading into Election Day, Republican President Donald Trump trails Democratic rival Joe Biden in national polls.
But Trump is close in enough swing states to possibly piece together the votes needed to win the presidency.
For all today's gains, that leaves investors braced for a wild few days.
