World shares rally as G-20 meeting begins
LONDON - Agence France-Presse
REUTERS photoGlobal stock markets rallied on Feb. 26, helped by firmer oil prices, as finance ministers and central bankers from the world’s leading economies gathered to discuss recent financial turmoil.
As G-20 ministers met in Shanghai, markets were awaiting the latest US growth data for more clues on the state of the world’s biggest economy.
Eurozone indices were heading toward 2-percent gains around midday after a strong showing by stocks on Asian bourses.
“Investors are cautiously optimistic as we see out the week, but there will no doubt be many more twists and turns on the road ahead,” said Mike McCudden, head of derivatives at stockbroker Interactive Investor.
“With the G-20 summit... and high expectations of bullish comments from the forum, investors are taking their cue to move with the hot air and push stocks higher.
“The oil price is the major motivator for movement,” he added.
Benchmark oil contract Brent North Sea crude rose back above $36 a barrel on Feb. 26, boosting shares in energy companies.
Market-wide rallies came as officials from the Group of 20 industrialized nations gathered for a two-day meeting, with China’s sagging growth expected to loom over the discussions.
Shanghai’s main stocks index rose almost one percent after the head of the People’s Bank of China said the economy was strong and signaled authorities could do more to help stimulate growth.
Shanghai had plunged more than six percent on Feb. 25, hit by tightening liquidity and concerns a rally that has added 10 percent since mid-January was overdone.
Pressure has meanwhile been mounting for central banks to let loose their monetary firepower to stimulate growth and reassure investors, after financial markets posted one of the worst starts to the year in living memory.
Japan has already adopted negative interest rates, the European Central Bank has embarked on its own huge stimulus program, and the US Federal Reserve has signaled possible delays to interest rate rises.
But German Finance Minister Wolfgang Schaeuble set the stage for disputes at the Shanghai meeting when he said Europe’s largest economy opposes any G-20 fiscal stimulus package.