European stocks cheer with US tax cuts firmly in their sights

The London Stock Exchange logo is pictured in London. Photo: BEN STANSALL/AFP/Getty Images

Wall Street stocks rose, building on pre-weekend records, with the Dow advancing 0.7 per cent in New York's late morning.

In Europe, London's benchmark FTSE 100 index rose 0.6 per cent, with gains limited by the pound rising versus the dollar impacting multinational UK companies whose reported earnings are in the US currency.

In the eurozone, Frankfurt's DAX 30 rallied 1.6 per cent, with sentiment boosted by coalition talks due this week between Chancellor Angela Merkel's Christian Democrats and the Social Democrates.

The Paris CAC 40 advanced 1.3 per cent.

"The prospect of tax cuts being approved ahead of Christmas is propping up global stock markets," said market analyst David Madden at CMC Markets UK.

The controversial reforms look destined to become US President Donald Trump's first major congressional victory as two key Republican holdouts in the Senate decided to back the bill after their demands were met on Friday.

The news sent US stocks soaring the same day on hopes the cuts will help fire the already healthy economy and boost company profits. They continued to push higher on Monday.

As the dollar rose against the yen, in turn lifting share prices of Japanese exporters, Tokyo's main stocks index surged 1.6 per cent by the close Monday.

Prior to some profit-taking, the dollar benefitted from the tax hopes as traders bet that the cuts would fan US inflation and push the Federal Reserve to hike borrowing costs further.

On the corporate front, shares in Thales soared more than eight per cent to €93.31 - a day after the French aerospace and defence group said it was buying European SIM manufacturer Gemalto for €4.8 billion (US$5.7 billion) to become a global leader in digital security.

Gemalto stock was up 5.6 per cent at €49.46.

Elsewhere on Monday, bitcoin jumped almost 10 per cent to US$19,500 at one point, according to Bloomberg, as the CME Group, which runs the world's biggest futures exchange, began trading futures in the cryptocurrency on Sunday.

It later fell back to US$18,727.82

The listing came a week after Bitcoin started on the Cboe, the first time it had appeared on a major exchange and marking a watershed for the unit, despite warnings about its extreme volatility and a possible bubble explosion.

Bitcoin has soared in recent weeks, breaking numerous records, and has risen more than 20-fold since the start of the year on speculative buying.

Key figures around 1630 GMT:

London - FTSE 100: UP 0.6 per cent at 7,537.01 points (close)

Paris - CAC 40: UP 1.3 per cent at 5,420.58 (close)

Frankfurt - DAX 30: UP 1.6 per cent at 13,312.30 (close)

EURO STOXX 50: UP 1.4 per cent at 3,611.12

New York - DOW: UP 0.7 per cent at 24,821.49

Tokyo - Nikkei 225: UP 1.6 per cent at 22,901.77 (close)

Hong Kong - Hang Seng: UP 0.7 per cent at 29,050.41 (close)

Shanghai - Composite: UP 0.1 per cent at 3,267.92 (close)

Euro/dollar: UP at US$1.1803 from US$1.1755 at 2200 GMT on Friday

Pound/dollar: UP at US$1.3397 from US$1.3323

Dollar/yen: DOWN at 112.37 yen from 112.63 yen

Oil - Brent North Sea: UP 32 cents at US$63.55 per barrel

Oil - West Texas Intermediate: UP 18 cents at US$57.51