LONDON - European and US equities rose on Wednesday as investors waited for US President Donald Trump to reveal his tax reform plans.
"Global stock markets have taken a major step out of their recent malaise today, with traders spending much of the day waiting with baited breath to see exactly what the Trump tax plan is going to look like," said market analyst Joshua Mahony at online trading firm IG.
Investors have been salivating for months over the prospects of lower corporate taxes, which would boost profits of blue-chip companies and other businesses considerably.
Wall Street is also a fan of a cut in personal taxes, another Trump priority expected to feature in the plan.
"While the prospect of lower taxes promises a bounty for stocks, it is worth noting that Trump has yet to deliver on any major policies given the constant rebuttals from the Republican-dominated Congress," noted Mahony.
"There is a good chance that these tax reforms are going to be as difficult to pass as the health reforms, with issues such as the controversial border adjustment tax likely to provide significant hurdles along the way," he added.
Trump campaigned on unravelling the health care reforms put in place by his predecessor Barack Obama, but some Republican lawmakers in the Senate have refused to endorse changes that would lead to reduced coverage, with a last gasp chance at a new law failing this week.
In European trading, shares in Alstom were among the strongest performers with a gain of 4.3 percent to close at 35.07 euros on news of the merger of its rail activities with German industrial giant Siemens. Siemens' stock meanwhile won 1.2 percent to 117.95 euros.
Shares in Ryanair gained more than 3.4 percent in Dublin to 16.99 euros after the low-cost airline announced more flight cancellations and the abandonment of its bid for Italy's Alitalia as it sought to overcome its pilot shortage.
Earlier in Asia, major stock markets were mixed as US-North Korea tensions continue to jangle nerves and keep investors from buying with any conviction.
The yen -- which had surged in safe-haven buying Tuesday after Pyongyang accused Trump of declaring war and said it may shoot down US bombers -- gave up some of those gains before climbing anew.
The euro also rebounded in late European trade, after having touched a low of nearly six weeks against the dollar following a rally in the greenback on comments Tuesday by Federal Reserve boss Janet Yellen that the central bank would press on with its plan to raise borrowing costs, saying the US economy was strong enough to withstand it.
Analysts interpreted her comments as suggesting she did not want to delay raising rates and end up having to introduce sharper increases down the line -- which could risk a recession.
AFP