By Peter Nurse
Investing.com - European stock markets pushed higher in early trade on Tuesday, as strong results from mining groups reinforced talk of a new 'supercycle' in commodities amid hopes for a broad and synchronized global recovery.
At 3:40 AM ET (0840 GMT), the DAX in Germany traded 0.1% higher, the CAC 40 in France rose 0.1%, and the U.K.'s FTSE index climbed 0.4%.
BHP Group PLC (LON:BHPB) stock fell 0.3% after the world’s largest listed miner had to write down the value of its coal business which is up for sale or spin off. That said, the mining giant did report its best first-half profit in seven years and declared a record interim dividend, helped by strong demand for iron ore from China.
Glencore (LON:GLEN) stock also rose 2.4% after the commodity trading and mining company reported a return to profit in the second half of 2020 and said its dividend would resume this year.
Successful rollouts of Covid-19 vaccines in many countries, with the U.K. leading the way among the developed world, have raised hopes of a relatively quick economic recovery as restrictions on business and social life are lifted.
Adding to this, the World Health Organization authorized the AstraZeneca/University of Oxford Covid-19 vaccine for emergency use on Monday, expanding access to this comparatively inexpensive shot to less developed countries around the world.
At the same time, U.S. President Joe Biden’s $1.9 trillion stimulus package continues to work its way through Congress.
However, despite this optimism, the immediate economic picture in Europe remains challenging.
Passenger-car sales fell 28% across Germany, the U.K., France, Italy and Spain, Europe’s five biggest markets, in January as lockdowns shut down dealerships and customers shied away from large purchases.
The region’s fourth-quarter GDP release is due later in the session, but most eyes will be on the German ZEW Economic Sentiment index for February as a more current gauge of consumer confidence.
Oil prices pushed higher Tuesday, as the severe cold spell in the U.S. resulted in heavy demand for power as well as disrupting supplies in Texas, the biggest crude producing state.
The deep freeze halted Texas oil wells and refineries on Monday and forced restrictions on natural gas and crude pipeline operators, resulting in blackouts throughout the state.
U.S. crude futures traded 0.9% higher at $60.05 a barrel, while the international benchmark Brent contract rose 0.1% to $63.35, both contracts not far removed from their highest levels since January last year.
Elsewhere, gold futures rose 0.1% to $1,823.65/oz, while EUR/USD traded 0.2% higher at 1.2146.