Yahoo Finance Global stocks climb higher as bond markets stabilise
Watch: European stocks climb
European stocks jumped on Monday as a level of calm returned to bond markets after last week's sell-off.
The FTSE 100 (^FTSE) ended 1.62% higher after suffering its biggest plunge since October on Friday.
Housebuilders lead the rally in London, amid talk that government guaranteed 95% mortgages will be announced as a part of the chancellor's budget on Wednesday. Persimmon (PSN.L), Vistry (VTY.L), Redrow (RDW.L) and Taylor Wimpey (TW.L) all climbed around 5% on the day.
"Requiring a smaller deposit should help increase the number of people onto the housing ladder and fuel demand, hence the rise in the stock prices of the homebuilders," said David Madden of CMC Markets.
"House prices are already lofty so throwing more fuel on the fire – introducing 95% mortgages – could squeeze prices even higher. There is a risk the banking and construction sector will repeat the same mistakes that were made pre-2007."
British Airways owner IAG (IAG.L) was also among the top risers, gaining 6.95%.
The CAC (^FCHI) rose 1.61% and the DAX (^GDAXI) was 1.55% higher.
Richard Hunter, head of markets at Interactive Investor, said: “There has been a pause for breath after the bond market sell-off stabilised, although inflation concerns remain near the surface. Those fears of inflation have certainly not gone away but attention has shifted back, perhaps temporarily, to the immediate positive drivers which could propel a strong economic rebound.
"More generally, the success so far of the vaccine rollouts and the pent-up consumer demand which has partly been due to enforced savings are preparing the ground for a spending spree later in the year."
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Across the pond, the S&P 500 (^GSPC) rose 2.99% by the European close, and the tech-heavy Nasdaq (^IXIC) climbed 2.55%. The Dow Jones (^DJI) edged 2.13% higher.
It comes amid hopes for progress in the huge US stimulus package and optimism about the global economy. Investors are also counting on upbeat news from a raft of data due this week including the February payrolls report.
Asian shares also rallied on Monday. Over the weekend, China's official manufacturing PMI missed forecasts, expanding in February at a slower pace than a month earlier and hitting the lowest level since last May.
The official manufacturing Purchasing Manager’s Index (PMI) fell to 50.6 from 51.3 in January, data from the National Bureau of Statistics (NBS) showed on Sunday, remaining above the 50-point mark that separates growth from contraction.
Japanese figures, however, showed the fastest growth in two years, since December 2018, as strong orders led to the first output rise since the start of the coronavirus pandemic
MSCI's broadest index of Asia-Pacific shares outside Japan edged up overnight after shedding 3.7pc last Friday. Japan's Nikkei (^N225) rallied 2.41%, while Chinese blue chips also gained.
The Hang Seng (^HSI) rose 1.54% and the Shanghai Composite (000001.SS) jumped 1.21%.
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