Europe open: Shares maintain rally as investors eye UK budget measures

European shares continued their rally on Wednesday as London’s FTSE outperformed on hopes of stimulus measures to be unveiled in a new budget.

The pan-European STOXX 600 index rose 0.66% by 0844 GMT. The FTSE 100 was up 1.14%, while the German DAX increased 0.88% as the government looked ready to relax some coronavirus curbs according to reports.

Weakness in U.S. bond yields supported global stocks, while German Chancellor Angela Merkel was poised to agree a gradual relaxation of coronavirus curbs with regional leaders.

Investors were set for UK finance minister Rishi Sunak’s budget speech, due to begin around 1230 GMT.

With the majority of major measures already leaked by Sunak’s department, including a five-month extension of its furlough scheme, focus will be on action to help house builders, travel, pubs and the retail sector.

In equity news, Micro Focus shares surged 14% after the software company said it had signed a commercial agreement with Amazon Web Services.

Shares in UK insurer Hiscox Ltd plunged 11% as it swung to a huge loss for 2020 and continued to withhold its dividend.