LONDON - An easing of tensions in Ukraine combined with subdued Chinese inflation figures helped stock markets around the world enjoy one of their best days in a while. For weeks, markets have been roiled by a raft of geopolitical concerns, more often than not centered on the crisis in Ukraine.
In early Monday afternoon European trade, German's DAX spiked 1.6 percent to 9,155 while France's CAC-40 added 0.9 percent to 4,185. Britain's FTSE 100 advanced 0.8 percent to 6,620. U.S. markets were poised for further gains at the open too, with Dow futures and the broader S&P 500 futures up 0.4 percent. On Friday, the Dow added 1.1 percent and the S&P was up 1.2 percent as fears of a Russian invasion of western Ukraine eased amid signs the country's military drills were ending.
Tokyo's Nikkei 225 soared 2.4 percent to 15,130.52 points and China's Shanghai Composite Index gained 1.4 percent to 2,224.65. Hong Kong's Hang Seng added 1.3 percent to 24,650.30. Seoul's Kospi was up 0.4 percent at 2,039.37. India's Sensex rose 0.8 percent to 25,526.87 and Sydney's S&P ASX 200 added 0.4 percent to 5,457.
After taking a jab at the West with last week's ban on food imports, Russia called an end to military exercises near Ukraine and withdrew troops to their bases. Though fears of a Russian invasion have eased, geopolitical concerns remain not least with regard to Iraq, where U.S. warplanes attacked Islamic State militants near the northern city of Irbil, capital of the Kurdish region, in hopes of limiting their advance and keeping them away from oil fields.
"Signs late Friday afternoon of easing tensions in Russia -- drills were ending - helped spark a rally in U.S. stocks and that optimism has been carried forward on Monday morning," said Jennifer Lee, an analyst at BMO Capital Markets.
Stocks have also been buoyed by news that China's inflation rate in July came in at 2.3 percent, well below the official target for the year of 3.5 percent. That gives the central bank room to ease access to credit if needed to shore up economic growth, which was 7.5 percent in the latest quarter. That would lower the cost of financing for stock trading, helping to support markets.
Elsewhere the mood was fairly flat. Among currencies the euro was down 0.1 percent at $1.3392 while the dollar rose 0.1 percent to 102.12 yen. Meanwhile, a barrel of benchmark New York crude was up 3 cents at $97.68.