Europe open: Shares rally as Trump-China, Starmer turmoil in focus
By Frank Prenesti
Date: Wednesday 13 May 2026
(Sharecast News) - European shares rallied on Wednesday as investors eyed US President Donald Trump's visit to China, the continuing political turmoil in the UK and efforts to maintain the fragile Iran war ceasefire.
The pan-regional Stoxx 600 was up 0.7% to 610 by 0814 BST with all major bourses higher.
British Prime Minister Keir Starmer was set to meet this morning with Health Secretary Wes Streeting - widely seen as his main rival in any challenge for the leadership - a day after he refused to stand down despite the resignation of four ministers and growing calls for him to resign.
The uncertainty led to UK bond yields hitting their highest level since 1998 as traders feared higher spending by any successor to Starmer and the looming threat of the hard right Reform group - led by Nigel Farage - which made large gains in last week's local council elections at the expense of the ruling Labour Party.
"The name Farage resonates in markets as a clearer path toward looser fiscal policy, higher spending and larger deficits, just as investors are already worried about Britain's debt and inflation outlook. That combination is pushing investors to demand higher compensation to hold UK government debt sending the UK 10-year gilt yield back above 5%," said Swissquote analyst Ipek Ozkardeskaya.
"That's the highest level since 1998. The higher the borrowing costs, the less the government can borrow, and the impact on growth would be negative."
Meanwhile Trump is set to arrive in Beijing to meet his fellow autocrat Xi Jinping where trade, Taiwan and the Iran war are expected to be the main topics of talks.
In a busy day of European corporate updates and quarterly earnings reports shares in UK housebuilder Vistry slumped as it issued a profit warning and paused share buybacks.
Adecco shares were also sharply lower after the recruiter posted first-quarter results, while Merck shares surged also after results and a lift in guidance.
Reporting by Frank Prenesti for Sharecast.com
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