European stocks rise, gold hits record awaiting US stimulus talks

European stock markets climbed solidly Wednesday after a mixed Asian showing, with traders tracking talks on a key US stimulus package that fuelled another record-high finish on Wall Street.

Approaching midday, London's benchmark FTSE 100 index was up 1.0 per cent, helped also by strong rebounds for the UK services sector and sales of new cars after both plummeted during the country's lockdown.

In the eurozone, Frankfurt won 0.9 per cent and Paris climbed 0.8 per cent.

The euro was higher versus the dollar and pound, while oil prices jumped around 2.5 percent.

At the same time, long-running uncertainty about the global economic outlook caused by the coronavirus pandemic and a weak dollar helped gold to a fresh high at $2,041.92 an ounce after the haven investment on Tuesday hit above $2,000 for the first time. 

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"Stocks are back in rally mode..., maintaining the bullish outlook for August," noted Chris Beauchamp, chief market analyst at IG trading group.

"That both equities and the supreme risk-off asset (gold) are moving higher just shows how conflicted investors are -- they can't avoid being tempted by equities, but they can also read the unending stories of bankruptcies," he added.

In the UK, it was revealed that the IHS Markit/CIPS Services purchasing managers' index (PMI) rose to 56.5 in July from 47.1 in June.

A reading above 50 indicates an expansion, and July's rebound indicated "the very early stages of recovery... from an exceptionally low base", said Tim Moore, economics director at IHS Markit.

Agence France-Presse