FTSE 100: European markets finish higher following UK budget
The FTSE 100 (^FTSE) and European markets closed higher on Wednesday in London, as the UK government unveiled its spring budget.
The FTSE 100 ticked up 0.3% to close at 7,672 points. The more domestically-focused FTSE 250 (^FTMC) finished 1% higher. The pound (GBPUSD=X) rose cautiously against the dollar to just above $1.27.
Elsewhere in Germany and France, the DAX (^GDAXI) and CAC (^FCHI) also rose 0.1% and 0.3% respectively.
Traders were somewhat optimistic as UK chancellor Jeremy Hunt announced a cut to national insurance and the launch of a new British ISA.
Read more: What has been announced in the spring budget?
“The chancellor’s budget has sought to address the decline in the proportion of UK pension fund assets invested in UK assets and in doing so, tackle the deep and well-documented valuation discount that the UK equity market trades on," Indriatti Van Hien, portfolio manager on the UK equities team at Janus Henderson Investors, said.
"The announcement of a new British ISA and the requirement being placed on pension funds to disclose the proportion of assets invested in the UK are clear first steps taken to reinvigorate the UK equity market. Incentivising increased investment in UK listed assets should enhance the attractiveness of the UK stock market to fast-growing innovative companies which will allow UK pension funds to share in the capital growth and success of such companies. It is a virtuous circle and we welcome such developments," she added.
US and Asia
Trade in Asia was mixed overnight, with an underwhelming performance by the Nikkei (^N225) in Japan and strong gains by the Hang Seng (^HSI) in Hong Kong.
The Hang Seng rose 1.7%, recovering some of the losses seen on Tuesday, when worries about the growth and security of the Chinese economy were on the docket.
Meanwhile, US stocks opened higher on Wednesday, with techs vaulting back from a steep sell-off as investors digested Federal Reserve Chair Jerome Powell's stance that interest rate cuts are still likely this year.
Read more: Tax on vapes and tobacco to ramp up as alcohol duty frozen in budget
The tech-heavy Nasdaq Composite (^IXIC) jumped about 1% after techs led a sharp slide in stocks more broadly on Tuesday. The S&P 500 (^GSPC) added more than 0.6%, while the Dow Jones Industrial Average (^DJI) popped 0.5%, as both indexes came off losses of more than 1%.
Bitcoin and crypto
Bitcoin (BTC-USD) and crypto markets were the story of the day on Tuesday, with the largest cryptocurrency briefly reaching all-time highs, before tumbling back down more than 10%.
The price recovered a little on Wednesday, to trade at more than $67,400.
The run-up last week was associated with both capital inflows due to the spot bitcoin ETF approval earlier this year, and the upcoming halving event.
Watch: Budget: Chancellor confirms new British ISA to boost investment in the City
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