World stocks soar on stimulus hope

global stock markets stormed ahead buoyed by forecast-beating results on both sides of the Atlantic and as grim economic data raised hopes of fiscal stimulus measures and a European interest rate cut.

London’s benchmark FTSE 100 index rallied 2 per cent or 125.5 points to 6,406.12, led higher by blue chips Arm Holdings and Primark parent Associated British Foods following better-than-expected trading updates. Robust earnings from the likes of US giants Netflix and DuPont also underpinned investor sentiment.

Adding to the upbeat atmosphere was speculation that the European Central Bank will act to boost the eurozone following figures showing that Germany’s private sector shrank in April.

Alex Young, senior sales trader at CMC Markets, said: “Data out of Germany this morning initially disappointed traders, who dragged indices back from their highs early in the session.

“The tone quickly changed however, with the consensus view seeming to be that data of this nature makes an imminent European rate cut more likely.”

Arm was the biggest Footsie riser after it delivered a higher-than-expected 44 per cent hike in underlying pre-tax profits. Sales surged by more than a quarter and royalty revenues hit a new record, shares jumping 12 per cent or 103p to 972p.

Associated British Foods followed with a 149p improvement to 1,999p after it reported another strong trading period for retail division Primark.

Aim-quoted medical testing kit maker Omega Diagnostics was in demand after its CD4 test for monitoring HIV-positive patients was awarded a US patent. The Alva-based firm said it has patents pending in many other territories. Shares gained 7.7 per cent to 17.5p.

NEW YORK: US stocks climbed last night in a broad rally, recovering from sharp declines sparked by a “bogus” Associated Press tweet about explosions at the White House.

The Dow Jones industrial average rose 152.29 points, or 1.05 per cent, to end at 14,719.46 while the broader Standard & Poor’s 500 Index gained 16.27 points, or 1.04 per cent, to finish at 1,578.77. The Nasdaq Composite Index climbed 35.78 points, or 1.11 per cent, to close at 3,269.33.