The news of the resignation of British Prime Minister Liz Truss, prompted by her economic program, seems to have had a particularly positive effect on European stock markets yesterday, a program that has caused serious turmoil in the markets. The pan-European STOXX 600 ended the session up 0.26%. In London, the FTSE 100 closed up 0.27%, up 0.20% in the Frankfurt DAX, up 0.76% in Paris CAC 40, up 1.07% FTSE MIB in Milan and Madrid up 0.80 %IBEX. . Liz Truss took office on September 6 and last week was forced to remove her finance minister and closest ally, Kwasi Kwarteng, and abandon almost her entire economic agenda.

Their plans for massive unwarranted tax cuts caused turmoil in the markets, leading to the collapse of the pound sterling and government bonds. The Bank of England was forced to intervene. “The Lees Truss approach also caused an overreaction in the market,” said Steve Sosnick, chief strategy officer at Interactive Brokers. “You would think that if she is a really unpopular prime minister, then with her resignation, the market could go to buy or strengthen the currency. I think that the fact that none of this happened tells us that the markets need political stability, and now they don’t have it.”

In addition, giant Nokia reported weaker-than-expected results, as did competitor Ericsson, due to ongoing patent disputes. This condition lowers the profit margin and offsets the high demand for 5G telecom network equipment.

The euro strengthened 0.3% against the dollar to $0.981.

Their share prices fell 7.6% and 14.8% respectively yesterday. More than half of the sectors included in the pan-European STOXX 600 index rose yesterday, with the technology sector in particular adding 1.94%. The biggest industry losses were in telecommunications, with a 2.5% drop.

The euro strengthened 0.3% against the dollar to $0.981, while oil in New York rose 0.9% to $86.31 a barrel.

REUTERS, BLOOMBERG