European indices opened higher on Tuesday as the rebound from Wall Street and Asia carried into the session. Germany's DAX, the UK's FTSE and Spain's IBEX all gained, but France's CAC 40 rose only modestly as investors stayed wary of the country's fiscal troubles.
European stocks extended their rebound at the open, with the Eurostoxx up 0.5% alongside similar gains across most of the region. Germany's DAX and the UK's FTSE each added 0.5% and 0.6% respectively.
Spain's IBEX and Italy's FTSE MIB both climbed 0.7%.
France remains the laggard
France's CAC 40 is still trading higher, but its gain of just 0.2% marks it out as the region's weakest performer. Investors are not yet ready to look past the country's fiscal troubles, which have kept French government bonds under pressure in recent sessions as markets question whether the government can deliver on its budget plans and stabilize the debt outlook.
That pressure showed up in the bond market last week, when the yield spread between French and German 10-year bonds surged to 150 basis points on Friday, the widest gap since 2012. This fiscal strain remains one of the bigger risks hanging over European assets for now, and the key question is whether it stays contained or begins spilling over more noticeably into the rest of the region.
Wall Street momentum carries over
The rebound in Europe follows a positive session on Wall Street, where the Nasdaq closed at another record high overnight. US futures are pointing modestly higher too, with both S&P 500 and Nasdaq futures up around 0.2%, continuing the tech-led advance.
Still, the early gains may not tell the full story. Long-end Treasury yields remain close to multi-decade highs, keeping broader rates pressure firmly in view even as equities push higher.
Source: Investinglive
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