By Harshit
LONDON, NOV. 10
European markets surged on Monday as investor confidence improved sharply following progress toward a bipartisan deal in the U.S. Senate that could bring an end to the record-long government shutdown. The prospect of the world’s largest economy reopening fully helped lift global sentiment, reversing some of last week’s losses driven by fears of slowing growth and inflated technology stock valuations.
The pan-European Stoxx 600 rose 1.6% by Monday afternoon, with nearly every major sector in positive territory. Gains were led by banks, technology firms, and consumer stocks as traders digested the latest developments from Washington and fresh signs of economic resilience across Asia.
Markets Rally Across Europe
By 2:05 p.m. in London (9:05 a.m. ET), the U.K.’s FTSE 100 was up 0.9%, while Germany’s DAX surged 1.8%. France’s CAC 40 climbed 1.5%, and Italy’s FTSE MIB advanced 2.3%, as risk appetite returned to European equities.
The rally came after U.S. Senate lawmakers moved late Sunday toward advancing a funding package that would temporarily reopen the government through January. The proposal, which cleared a key procedural hurdle, reportedly has enough support to meet the Senate’s 60-vote threshold, according to officials familiar with the discussions.
U.S. Shutdown Nears Resolution
The agreement being debated in the Senate includes measures to reverse some of the mass federal layoffs triggered by the shutdown and restore key government services.
A University of Michigan survey released Friday showed consumer sentiment at its lowest level in more than three years, reflecting growing unease over the shutdown’s economic toll. With the Bureau of Labor Statistics and several other federal agencies shuttered, few official data releases have been available to gauge the impact.
If the deal passes, it would mark a significant political breakthrough and reduce near-term risks to U.S. growth. The shutdown, which began in early October, has disrupted sectors ranging from air travel to public services, while temporarily halting economic data collection.
Tech and Financials Lead European Gains
Technology and financial stocks spearheaded Monday’s rally. The Stoxx 600 Technology Index climbed 2.1%, and the Stoxx 600 Banks Index gained 2.6%, reflecting renewed optimism in cyclical sectors.
Among individual movers, Diageo jumped 6.9% after announcing Dave Lewis as its new chief executive. The appointment follows last week’s steep selloff when the spirits maker cut its full-year outlook due to weakness in U.S. and Chinese demand.
Novo Nordisk rose 2.6% after revealing a new partnership with India’s Emcure Pharmaceuticals to distribute its popular weight-loss drug Wegovy under a co-branded deal. However, the Danish drugmaker confirmed it had lost out to Pfizer in the $10 billion acquisition battle for obesity biotech firm Metsera.
Elsewhere, Sweden’s Camurus soared 14.8% after announcing strong clinical results for its obesity treatment candidate CAM2056, which it said matched or outperformed the efficacy of Wegovy in early testing. Zealand Pharma shares also climbed 4.2%, adding to a wave of investor enthusiasm in the fast-growing obesity drug sector.
Global Sentiment Improves
In global markets, U.S. stock futures rose in early Monday trading, reflecting optimism that Washington’s breakthrough could help avert deeper economic fallout. Futures tied to the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite all traded higher following last week’s declines.
Last week, Wall Street had struggled under pressure from high AI stock valuations. Tech giants Nvidia, Microsoft, and Broadcom saw sharp selloffs after investors questioned whether recent gains had run too far ahead of fundamentals.
Meanwhile, Asia-Pacific markets followed the global upswing overnight. Benchmarks in Tokyo, Hong Kong, and Sydney all finished higher, buoyed by stronger-than-expected Chinese inflation data for October. The data eased fears of deflation and hinted at improving domestic demand following months of weakness in China’s property and manufacturing sectors.
Outlook
Analysts said Monday’s rally underscores how sensitive markets remain to Washington’s political developments and global macroeconomic signals.
“Any sign of stability from the U.S. is a relief valve for markets that have been on edge due to the shutdown and uncertainty around fiscal spending,” said one London-based strategist at BNP Paribas. “Europe is catching that tailwind today, and optimism should hold as long as the Senate pushes the deal across the finish line.”
With the U.S. Federal Reserve’s next meeting approaching and global earnings season winding down, investors will be watching closely for further signs of stability in both the political and economic arenas.