SEOUL, South Korea—Global stock markets were sharply higher Wednesday as worries eased about stepping into an era of uncertainty following Britain’s referendum on EU membership. The British pound rose.
Europe got off to a strong start. The FTSE 100 jumped 2 percent to 6,261.39 in early trading and Germany’s DAX advanced 1.6 percent to 9,597.63. France’s CAC 40 gained 2.1 percent to 4,176.64. Futures augured a positive start for Wall Street. Dow futures added 0.4 percent and S&P futures also rose 0.4 percent.
Investors appeared to have set aside their anxiety over Britain’s vote, encouraged by solid data on the U.S. economy and housing market.
But analysts said market volatility could return any time and it is too early to say that investor appetite for risk has made a full comeback.
Despite the solid performance of stock markets, “it’s likely that markets will leave a Brexit risk factor in pricing for a while yet,” Ric Spooner, chief market analyst at CMC Markets, said in a commentary.
“Stock markets may find it difficult to return immediately to the levels seen before last week’s vote with buyers being wary about being too aggressive in what may yet be just another volatile swing.”
Global financial markets were rattled last Friday after results showed that Britons had voted to leave the EU. Global ratings agencies slashed their top-shelf credit rating for the U.K., and the pound plunged to its lowest level in 31 years.
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In Asia on Wednesday, Japan’s Nikkei 225 jumped 1.6 percent to 15,566.83 and South Korea’s Kospi gained 1 percent to 1,956.36. Hong Kong’s Hang Seng index added 1.3 percent to 20,436.12, while Australia’s S&P/ASX 200 rose 0.8 percent to 5,142.40. Stocks in mainland China, Taiwan, Singapore and Indonesia also were higher.
The British currency recovered some of its losses this week but remained near its 31-year low. On Wednesday, the pound rose 0.4 percent to $1.3402. In other currencies, the yen, which strengthened sharply after the British referendum, extended its gains. The dollar weakened to 102.574 yen from 102.632 yen. The euro weakened to $1.106 from $1.108.
Benchmark U.S. crude rose 65 cents to $48.50 per barrel in New York. The contract added $1.52, or 3.3 percent, to close at $47.85 a barrel on Tuesday. Brent crude, used to price international oils, gained 58 cents to $49.84 a barrel in London.
