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Coronavirus: European stocks rise ahead of key vote on EU recovery plan

German Chancellor Angela Merkel
German chancellor Angela Merkel prepares to make a statement at the European parliament, which will vote on the EU's recovery package on Thursday. (Francisco Seco/AP)

European stocks rose on Thursday even as lawmakers in the European Parliament were expected to reject the expansive budget and €750bn (£682bn, $870bn) recovery plan agreed by EU leaders earlier this week.

While the parliament is thought to be supportive of the expansive stimulus package, it has taken umbrage at cuts to several of the bloc’s programmes in the separate, but linked, seven-year budget.

The pan-European STOXX 600 index (^STOXX) rose by around 0.4%, while London’s FTSE 100 (^FTSE) climbed by around 0.6%.

Germany’s DAX (^GDAXI) was up by around 0.6%, while France’s CAC 40 (^FCHI) climbed by almost 0.5%.

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A draft of a resolution due to be tabled by several of the European parliament’s major political groupings says that it “does not accept” the political agreement reached during a marathon summit of leaders that lasted almost five days.

The parliament, which can veto the agreement, will “engage immediately” in discussions to improve the proposal, according to the resolution.

European Council president Charles Michel and chancellor Angela Merkel of Germany, which holds one of the bloc’s rotating presidencies, will attempt to pacify the parliament.

Partly dragged down by renewed tensions between the US and China, stocks in Asia were mixed on Thursday.

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Shanghai’s SSE Composite Index (^SSEC) fell by around 0.2% on Thursday, while the Hang Seng (^HSI) closed over 0.6% in the green in Hong Kong.

Japan’s Nikkei (^N225) fell by almost 0.6%, as did the KOSPI Composite Index (^KOSPI) in South Korea. Australia’s ASX 200 (^AXJO) rose by more than 0.3%.

Futures were pointing to a higher open for US stocks on Thursday.

S&P 500 futures (ES=F) rose by around 0.4%, while Dow Jones Industrial Average futures (YM=F) climbed by around 0.3%. Nasdaq futures (NQ=F), meanwhile, were up by around 1%.

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