European Stocks closed higher to reverse a two-day selloff on an increase in investor’s appetite for riskier assets offsetting lingering geopolitical concerns over Greece and the Middle East.
The stocks had suffered steep declines in the previous two sessions weighed down by disappointing economic data in the US and continued tensions in the Middle East as Saudi Arabia and its allies launched air strikes on Yemen.
The market volatility had triggered appetite for assets considered less risky like gold and the Yen but the move showed signs of unwinding on Friday.
According to the Wall Street Journal, Stoxx Europe 600 Index closed the session 0.3% higher while France’s CAC and Germany’s DAX closed 0.2%and 0.3% higher respectively.
The stocks had earlier looked on course for a third straight losing session as investors tracked the unrest in Yemen and awaited news on a deal over Greece’s economy next week.
London’s benchmark the FTSE 100 was the notable underperformer in the region slipping 0.58% to 6,855 points on the day.
The index was weighed down by a decline in mining shares on news that Chile’s copper mining industry had been forced to close down some of the largest mines after being hit by torrential rains.
The stocks were also helped by weaker euro as the dollar resumed its resurgence after fading at the beginning of the week on news that the Federal Reserve was in no hurry to raise America’s interest rates.
“I’m not surprised that European shares are fading their gains,” Gavin Friend, a strategist at National Australia Bank in London, told the International Business Times.
“The dollar is back stronger again today, but we seem to have gone through the period where the dollar was rampaging through markets. That brought all kinds of (U.S.) policymakers out of the woodwork and now we are in more of two-way market.”
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