LONDON, Nov 11 (Reuters) - Global shares edged up on Tuesday, driven by relief over the imminent end of the U.S. government shutdown, though gains were tempered by nagging worries about valuations in the technology sector, while the dollar held firm.
European shares (.STOXX), rose in early trading, led predominantly by gains in London's FTSE 100 (.FTSE), , which hit record highs as the pound fell following British employment data that gave investors more confidence in the chances of a growth-boosting rate cut from the Bank of England next month.
The U.S. Senate passed a deal on Monday that would restore U.S. federal funding after the longest shutdown on record. It will also release a raft of economic data, on anything from jobs to industrial production, which could inject some volatility into markets.
DATA DELUGE INCOMING
"Obviously, the shutdown isn't completely sorted yet. The House has got to get it through, but given the arithmetic of the House, that seems pretty certain," Investec chief economist Philip Shaw said, referring to the Republican majority in the House of Representatives.
"The data deluge is going to be essentially a huge market event. One question is whether the data and the analysis by the Fed are consistent with each other," he said.
The Federal Reserve cut interest rates at its most recent meeting, but Chair Jerome Powell cautioned against assuming another cut in December was a given, not least because of the uncertainty over what key data on employment and inflation might show.
The STOXX 600 (.STOXX), was up 0.6%, defying a 0.1% drop in S&P 500 and Nasdaq futures and against a backdrop of a softer session in Asia.
SHUTDOWN COMPROMISE CLEARS SENATE
The deal on the shutdown now heads to the House, where Speaker Mike Johnson has said he would like to pass it as soon as Wednesday and send it on to President Donald Trump to sign into law.
Prediction markets, such as the online Polymarket, have reopening nearly fully priced in for the end of the week.
The nearly six-week shutdown will have likely already knocked somewhere between 0.4 and 1 percentage points from fourth-quarter gross domestic product, said UBP economist Carlos Casanova in Hong Kong.
"However, if you look at previous instances, typically what happens is in the quarter after the activity bounces back ... so I think what the market is doing is looking ahead one quarter and repricing that rebound."
On Wall Street the S&P 500 (.SPX), closed up 1.54% for its biggest one-day percentage gain since mid-October and the Nasdaq (.IXIC), notched its largest daily gain since May.
A basket of the biggest AI-linked U.S. tech stocks on Monday staged its largest one-day rally since May, rising 2.8% . Some of that enthusiasm could be tempered by news that Japan's SoftBank Group (9984.T), , in its results, said it had sold its entire stake in Nvidia (NVDA.O), for $5.83 billion in October.
STERLING WILTS
On the currency markets, the pound was the weakest-performing major currency against the dollar. Sterling dropped nearly 0.4% to $1.3128, after data showed British wage growth slowed and unemployment rose in the three months to September, while a separate report showed consumer spending slowed in October.
The numbers strengthen the case for the BoE to cut rates next month, but they also show the uncertainty weighing on British households and businesses ahead of finance minister Rachel Reeves' annual budget, due on November 26, which is widely expected to contain more tax hikes.
Elsewhere, the Japanese yen touched its weakest level since February, at 154.49 to the dollar, before paring some of that loss to trade at 154.355 in European hours .
In commodities, gold sat comfortably above $4,100 an ounce, while copper futures rose 0.5% to $10,851 a tonne, and Brent crude futures dipped 0.25% to $63.90 a barrel.
The U.S. Treasury market was closed for Veterans Day.
Additional reporting by Tom Westbrook in Singapore; Editing by Kim Coghill and Alex Richardson
