British Pound Rallies On Johnson Resignation, Global Stocks Gain

The British pound rallied Thursday on British Prime Minister Boris Johnson's resignation as leader of the Conservative party, while Wall Street indices advanced for a fourth straight session.

Johnson's announcement followed an extraordinary series of resignations from his scandal-plagued administration.

He acknowledged it was "clearly the will of the parliamentary Conservative party that there should be a new leader of that party, and therefore a new prime minister."

The move lifted the pound above the $1.20 level.

"The currency market is relieved that Johnson is finally resigning, removing some of the political uncertainty that was priced into the pound and paving the way for a new prime minister," said Victoria Scholar, head of investment at Interactive Investor.

London's blue-chip FTSE 100 stock index also rose 1.1 percent, along with bourses in Paris and Frankfurt.

In New York, stocks also had a good day, with the S&P 500 and Nasdaq each advancing for a fourth straight day.

Maris Ogg of Tower Bridge Advisors said it is too soon to declare that the market has turned.

"I don't think (the rebound) is meaningful because we've got to wait on earnings," Ogg said, alluding to upcoming quarterly reports that investors fear will underscore a weakening economic outlook.

Elsewhere, oil prices pushed higher as markets focused on risks to petroleum supply, a shift from the recent fixation on the threat of recession.

Traders are worried about a potential interruption of a majority of Kazakhstan's total oil exports after a Russian court ordered a 30-day ban on unloading from the 1,500-kilometre (930-mile) pipeline from Kazakh oil fields to the Novorossiysk terminal, citing environmental violations.

Earlier stoppages from the pipeline have triggered speculation that the Kremlin might be punishing its Central Asian ally for its neutral stance on Ukraine.

Meanwhile, the euro struck a fresh 20-year low against the dollar as the minutes from the latest European Central Bank meeting showed it is happy to go slow with hiking interest rates, unlike the US Federal Reserve.

The European single currency is being hammered by growing fears of a recession for the eurozone and the likelihood of more aggressive US interest-rate hikes.