European stocks climbed on Friday as investors appraised the potential impact of government and central bank measures, hoping they will be enough to shield the global economy from a coronavirus-related recession.
Markets on Thursday reacted positively to new measures from both the ECB and Bank of England, while Norway’s central bank on Friday slashed its main interest rate by 75 basis points.
Meanwhile, UK chancellor Rishi Sunak is soon expected to announce a rescue plan to protect millions of jobs, including an employment and wage subsidy package.
“Calmed somewhat by the actions of the ECB and Bank of England on Thursday, Europe looked to keep the rebound going on Friday with a fresh round of growth,” said Connor Campbell, a financial analyst at Spreadex.
The pound, which has been dented heavily in recent days by investors searching for dollar liquidity, rose by more than 3% against the dollar (GBPUSD=X) to $1.185.
“These gains, especially for sterling, are at least in part predicated on the hopes that chancellor Rishi Sunak is all set to step in with a fresh round of business-protecting measures this Friday. God knows, they need it,” said Campbell.
Stocks made broad gains in Asia overnight.
The KOSPI Composite Index (^KOSPI) in South Korea, which lost around 8.4% on Thursday, climbed by 7%. Markets in Japan are closed for a public holiday.
Australia’s ASX 200 (^AXJO) rose 0.7% after the Reserve Bank of Australia on Thursday cut interest rates to a record low of 0.25%.
Futures were also pointing to a higher open for US stocks, after the Federal Reserve on Wednesday announced a fund that will provide loans to financial institutions that buy assets from prime money market funds.
Watch the latest videos from Yahoo UK