European stocks rallied on Tuesday as investors bet on the market’s resilience against the terrorist attacks taken place in Paris last Friday while French forces other countries in the effort to thwart Islamic State aspirations. Major European benchmarks rose sharply, aided by energy and defense shares. France’s CAC 40 rose 133 points, or 2.77%, to close Tuesday’s trading session at 4,937.31. The pan-European Stoxx Europe 600 gained 2.49% to trade at 379.88 with all sectors closing higher. The index’s energy sector added 3.4%, helping the index post its largest daily gain since early last month. The German DAX 30 added 57.81 points, or 2.41%, to trade at 10,971.04. The travel and leisure sector recovered from Monday’s declines spurred by the recent terror attacks as travel-related shares added more than 2%. Defence-related shares extended yesterday’s gains as BAE gains almost 2%, Airbus Group (PA:AIR) rises 4.27% and Rolls-Royce (L:RR) Holdings gains more than 5%.
In the meantime, U.S. stocks were mixed after a tightly ranged session as investors focused on recent positive earnings reports from Home Depot (N:HD) and Walmart (N:WMT). The reports helped these shares gain around 4%. The S&P 500 index fell 2.75 points, or 0.13%, to trade at 2,050.44. The Dow Jones Industrial Average added 6.49 points, or 0.04%, to trade at 17,489.50 and the Nasdaq Composite gained 4 points, or 0.03%, to trade at 4,986.02.
Oil prices rose slightly during early Wednesday trading in Asia as the markets focus on the market’s oversupply ahead of next month’s meeting of the Organization of Petroleum Exporting Countries (OPEC). Oil prices rose immediately after the deadly attacks in Paris as French forces carry out retaliatory airstrikes against Islamic State targets in Syria. The attacks caused concerns over increased violence in the Middle East, which may lead to production setbacks. Prices have been trading since in a narrow range as traders discern the geopolitical tensions and supply issues. As of this writing, Crude oil is trading at $40.96 a barrel, up 0.71% so far today.
This week’s major economic data releases continue today with the release of statements from the Federal Reserve, Eurozone construction output and minutes from the European Central bank’s meeting. The Bank of Japan will post its interest rate decision on Thursday, followed by UK retails sales data. Canadian yearly inflation rate will release later on Friday.