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EU's massive recovery package boosts European stock market

(Xinhua)    13:25, July 22, 2020

The European Union's (EU) landmark economic recovery package has largely underpinned the region's stock market with major shares closing above four-month highs on Tuesday, lifting investor sentiment across the continent amid the ravaging COVID-19 pandemic.

After five days of intense marathon negotiations, the 27-member bloc reached on Tuesday morning an unprecedented deal on a 750 billion-euro coronavirus crisis recovery fund and the EU's long-term budget worth over 1 trillion euros. European Council President Charles Michel hailed the agreement as historic.

"We did it! Europe is strong. Europe is united," he told a press conference on Tuesday. "These were, of course, difficult negotiations in very difficult times for all Europeans."

The pan-European STOXX 600 gained 0.3 percent at Tuesday's close, after it advanced 1.3 percent temporarily during the day, with a majority of sectors turning into a green territory.

The biggest gainer in the benchmark tally was Norwegian online marketplace Adevinta, which shot up 26 percent after the company inked a deal with Ebay to buy the U.S.e-commerce giant's classified ads business.

Against the greenback, the euro on Tuesday surged to its highest level of 1.1539 U.S. dollars since early January 2019, before it ended at 1.1522 U.S. dollars, up by 0.68 percent.

On the country front, German stocks edged up on Tuesday, with the benchmark DAX index up 124.91 points, or 0.96 percent, to close at 13,171.83 points, striking a five-month high and wiping out nearly all its losses for the year.

Global internet technology and financial services provider Wirecard won the most among the blue chips, with its shares up 18.15 percent. Automotive supplier Continental and automotive manufacturer BMW rose by 2.55 percent and 2.28 percent respectively.

Manufacturing and electronics company Siemens was the most-traded share with a turnover of 303.5 million euros (347.3 million U.S. dollars).

British stocks rose on Tuesday, with the benchmark FTSE 100 Index up by 0.13 percent, or 8.21 points, to close at 6,269.73 points.

Hargreaves Lansdown, a financial service company, soared 10.13 percent, the top gainer of the blue chips. Rolls-Royce Holdings and BP increased by 7.85 percent and 4.21 percent, respectively.

According to the final conclusions, the debt-financed recovery fund comprises 390 billion euros in non-repayable grants and 360 billion euros in loans to member states. Seventy percent of the recovery fund should be used in 2021-2022. Another 30 percent can be used in 2023. The repayment of the pan-European debt under this fund should be completed by Dec. 31, 2058.

Volker Perthes, director of the Berlin-based German Institute for International and Security Affairs, told Xinhua that the pandemic pushed the EU to elicit major steps towards further integration, such as the economic recovery fund.

Perthes said that once the recovery fund is clinched, it would be a major move forward in terms of European solidarity.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Wen Ying, Liang Jun)

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