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The US S&P 500 rose to a new record high after Netflix's bumper results added fuel to a rally driven by a wave of US President Donald Trump's “America First” policy announcements.
An index of blue-chip stocks of large companies in the United States Stocks The index rose as much as 0.8 percent by midday in New York, surpassing the previous high of 6,099.97 points set on December 6.
Last week, the S&P 500 posted its best gains in five sessions since Trump won the election.
Shares of Netflix, which posted fourth-quarter earnings overnight that beat analysts' expectations, rose 11 percent on Wednesday, sending other technology stocks higher. Oracle shares jumped 6 percent after it joined other technology giants including OpenAI in announcing plans for a new comprehensive American artificial intelligence project.
The Nasdaq Composite rose 1.5 percent to come within striking distance of an intraday high in mid-December.
Wednesday's gains come at a time when Trump used his first three days in office to threaten to impose new tariffs on US allies, while promising to end the period of American “decline”.
Expected cuts in corporate tax rates and financial deregulation added to investor optimism a week after some of the country's largest banks reported sharply higher profits due to a rebound in deal-making and trading.
The Stoxx Europe 600 index also hit a record high on Wednesday as concerns about US tariffs eased and investors bought cheaper European stocks following strong corporate earnings.
The broad European index rose as much as 0.9 percent to a record high of 530.55, supported by gains by some of Europe's largest companies such as Danish pharmaceutical company Novo Nordisk and German Adidas.
It later rose 0.3 percent after giving up some of its gains.
Frankfurt's DAX index was up 0.9 percent by late afternoon – after hitting a new high – led by a 6.5 percent gain for Adidas after its strong full-year results.
“The risk-on environment was lifting all boats, especially the weakest,” helped by other factors including concerns about slightly easing US tariffs, said Luca Paolini, chief strategist at Pictet Asset Management.
Despite repeated threats, Trump has yet to impose new tariffs on goods exported to the United States from the bloc.
“There is some comfort in the view that Trump is softer than the market thinks,” said Emmanuel Cao, an analyst at Barclays.
“The (European) market is not afraid of Trump anymore because he gives the impression that he is trying to negotiate,” he said.
London's FTSE 100 index also hit a new intraday record before falling 0.2 per cent by late afternoon.
This rise came after a Bank of America survey of European fund managers this week showed that investors raised their allocations to European stocks as concerns grew about high valuations on Wall Street.
Only 19 per cent of fund managers were “overweight” US stocks in January, down from a record 36 per cent the previous month. The bank said this was the largest shift from US stocks to euro zone stocks in nearly a decade.
Trump also said Tuesday that his administration is discussing imposing 10% tariffs on Chinese imports as early as next month. He revealed on Monday that he would implement customs tariffs 25 percent against Mexico and Canada As soon as February 1.
