US shares have opened higher, joining in European markets’ partial recovery from their heavy losses on Thursday.
The Dow Jones index was up 3.24% at 25,942 points, London’s FTSE 100 rose 1.74% to 6,182. France’s Cac 40 was up almost 2% and Germany’s Dax 1.25%.
The gains were prompted in part by a positive US consumer confidence survey.
Thursday’s torrid trading left the Dow down 7% and Europe 5% lower. Despite the gains the Dow is still 1,000 points below Thursday’s opening level.
Thursday’s sell-off was prompted by a bleak view of the US economy from its central bank, the Federal Reserve, and reports of rising coronavirus cases from some US states.
On Friday, data from the University of Michigan showed a surprisingly big jump in confidence among consumers.
Markets remain volatile as investors struggle to assess the economic damage of coronavirus.
Ryan Giannotto, director of research at GraniteShares ETFs in New York, said there was no strong reason for the pick up in values: “People are just taking a breather after the outright selling yesterday,.
“There’s always going to be more headlines about coronavirus cases increasing, more tests increasing. That’s just something that markets, investors and companies are going to have to learn to deal with.”
In the UK, David Madden, analyst at CMC Markets, also said there were no strong reasons for either days’ moves:”The landscape hasn’t changed in the past 24 hours as there is still a possibility of a second wave of Covid-19 cases as countries reopen their economies.
“It is possible that yesterday’s move was just a knee-jerk reaction to the reports of rising cases, as traders have become accustomed to falling infection rates. “
He highlighted the fact that stocks were still down since Wednesday’s close.