European stock markets continued to rally on Friday, as investors’ hopes grew of a US stimulus package and a Joe Biden victory in the US election.
US futures were also pointing to a higher open, while Chinese stocks jumped overnight on better-than-expected services industry data.
The pan-European STOXX 600 (^STOXX) rose 0.3% on the open, reaching Its highest level since 18 September.
Wall Street also looked set for continued gains, as US president Donald Trump said “productive” stimulus talks had resumed just days after he scrapped negotiations.
Deutsche Bank analysts said in a note investors also had an “increasing focus on a potential Biden presidency and a possible blue wave.”
They pointed to new analysis by FiveThirtyEight pointing to a 68% chance of the Democrats winning the Senate as well as holding the House of Representatives, “raising the prospect of significant further stimulus” early next year.
“This would bring an end to the divided government that we’ve seen these last two years,” they wrote on Friday.
Chinese stocks also posted strong gains on Friday after a national holiday, after the Caixin services purchasing managers’ index (PMI) survey for September showed a fifth month of expansion.
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