Europe’s main stock markets crept higher yesterday in the absence of economic data, as investors eyed a strong rebound in Shanghai, dealers said.
Frankfurt won almost 1.0% in value while London and Paris eked out slender gains in late morning deals.
In London, the FTSE 100 up 0.1% at 6,194 points; Frankfurt - DAX 30 up 0.8% at 10,0026 points and Paris - CAC 40 flat at 4,463.10 points yesterday.
 “European stocks followed China’s lead higher yesterday after the Shanghai Composite hit a two-month high,” said CMC Markets analyst Jasper Lawler.
Chinese equities surged after authorities relaxed rules on borrowing to buy shares, but other Asian markets struggled as oil ticked lower. Tokyo was shut for a public holiday.
Star performer Shanghai climbed above 3,000 for the first time in over two months, meaning the bourse has now rebounded by 13% from a January low.
The Chinese market jumped 2.15% after authorities loosened rules on margin trading for the first time since last summer’s collapse in mainland markets.
“Most Asian equities seem to be continuing their winning streak,” added Deutsche Bank analysts in a research note to clients.
“Much of today’s... market rally, while building on momentum from last week, is also driven by the fact that policymakers have loosened controls on margin trading.”
Margin trading, through which investors only need to deposit a small proportion of the value of their trades, was behind a boom that sent the Shanghai bourse up 150% in 12 months, before it plummeted from last June after regulators moved to tighten rules on the practice.
After the turmoil that swept global trading floors in the first two months of the year, some stability has now returned to world markets.
March has seen a broad uptick, with sentiment boosted after the Federal Reserve lowered its interest rate hike forecast last week.
However, analysts said markets were having trouble maintaining their rally as dealers eye the long Easter break that starts this Friday.
“European equity markets are starting the new trading week little changed to moderately higher as... an overall lack of major news and data have provided little impulses for any market moves so far,” noted trader Markus Huber at City of London Markets.
He added: “Trading volume should be on the low side during this shortened trading week as most major markets are closed for trading on Good Friday later this week.”
The dollar continued to struggle against the yen after plunging last week in response to the Fed—citing weakness in the global economy—saying it would lower its outlook for raising borrowing costs this year.
In London, the FTSE 100 up 0.1% at 6,194 points; Frankfurt - DAX 30 up 0.8% at 10,0026 points and Paris - CAC 40 flat at 4,463.10 points yesterday.