The FTSE 100 and European shares rallied for a second day on Tuesday after Asian shares continued a risk-on rally over night.

A rally in global stocks has been sparked by optimism the number of coronavirus cases were falling in European epicentres.

Both Spain and Italy have recorded a consistent drop in new coronavirus cases over the past five days.

“The market is front running what it believes is a peak in the virus case count with Europe leading the way,” said Chris Weston, head of research at Pepperstone.

The German DAX has today entered a technical bull market from the 18th March low as its moved above 10,400.

A technical bull market is a market move higher of 20% or more.

The drop in cases has led to European governments laying out plans for a return to normal life. Austria has said it expected business to open again a1st May whilst Italy was working on a programme to start manufacturing again.

However, the rally in shares came as JP Morgan boss, Jamie Dimon, warned over the up coming recession and implications for the financial system.

“We don’t know exactly what the future will hold — but at a minimum, we assume that it will include a bad recession combined with some kind of financial stress similar to the global financial crisis of 2008,” Dimon said.

Travel shares surge

The FTSE 100 was buoyed by travel shares who have been destroyed during the spread of coronavirus.

Carnival shares were up over 24% to 890p building on yesterdays gains following the news the Saudi Arabian Public Investment Fund had taken a 8.2% stake in the cruise liner.

Carnival also announced it had successfully raised $1.95 billion through the issuance of convertible senior notes.

easyJet shares also cheered the apparent peak in coronavirus cases, rallying over 16%.

Intercontinental Hotels and International Consolidated Airlines were both up over 10%.