European stocks rise as risk appetite gradually returns but elsewhere gold and bonds are the winners as investors seek safety amid growing unease over North Korea, Syria and Russia. Ciara Lee reports.
Investors duck for cover as geopolitical concerns continue to dominate the markets in early trade. The yen, a favoured harbour in times of stress climbed across the board. While gold hit five month highs. Chinese President Xi Jinping, in a call with President Trump, stressed the need for a peaceful solution for the Korean peninsula. At the same time, the U.S. Secretary of State was in Moscow to denounce Russian support for Syria's leader. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "The fact that these diplomatic talks now need to be held, are an unwelcome distraction for the U.S. on an international basis when of course they will be wishing they could concentrate on the domestic front." Shares in Europe got off to a better start driven by gains in financial stocks and carmakers as first-quarter earnings season kicks off. An early 0.5 percent rise in the STOXX 600 index put it on course for its best day of the month. (SOUNDBITE) (English) WILSON KING INVESTMENT MANAGEMENT, HEAD OF RESEARCH, RICHARD HUNTER, SAYING: "What's you're seeing is some very strong results from the likes of Daimler for example in Germany. In terms of the UK, looking down the risers board, which is underpinning the strength of the market in earlier trade, you will see there has been some buying interest in some of the defensive stocks that are situated within the FTSE100 which could tend to chime with the other rush to safe haven assets such as gold which we're also seeing at the moment." The euro though sank to its lowest in five months, on track for 12 straight sessions of losses. Political uncertainty in France added to its woes as hard-left candidate Jean-Luc Melenchon surged in the polls ahead of May's election. Oil's winning streak got an added lift from reports Saudi Arabia was lobbying OPEC and other producers to extend a production cut beyond the first half of 2017.