European stocks gained and US equities were hesitant yesterday as investors awaited further stimulus and vaccine news, while bitcoin slipped back from record highs to below $48,000.
In equities, Paris posted gains of 0.6% and London 0.9 heading into the weekend, although Frankfurt was near flat at the close.
Markets around the world are “remaining buoyed by the recent rally that has been fuelled by Covid-19 vaccine rollout progress and elevated expectations that the US will deliver further fiscal relief,” Charles Schwab analysts commented.
Equities have rallied this year on the back of vaccine rollouts, falling infection and death rates, and optimism that US President Joe Biden will push through his $1.9tn stimulus package.
But London sentiment was dented Friday by news that the coronavirus-ravaged UK economy shrank by a record 9.9% in 2020, despite an upturn in the second half.
Across the Atlantic, US stocks were “pausing near record highs”, Schwab added, with the blue-chip Dow close to flat while the broader S&P 500 and tech-heavy Nasdaq Composite each nudged up around 0.1%. Bitcoin had touched a new high of $48,930 in Asian trade after MasterCard and US bank BNY Mellon moved Thursday to make it easier for people to use the cryptocurrency, only to trade over $1,000 lower around yesterday.
“Bitcoin had a great week” thanks in part to the institutional backing, OANDA analyst Edward Moya said, but “the key for Bitcoin’s path higher is to win over more corporate endorsements”.
“Massive weekend moves” nevertheless remain possible for the historically volatile cryptocurrency, he added.
Axi analyst Stephen Innes noted that the earnings season has gone well in the US and Europe, while the number of Covid-19 infections has been dropping faster than in previous waves.
But he added that “investors need some good old proof in the economic pudding before taking that next leap of faith.” 
Markets were awaiting a virtual meeting of finance ministers and central bankers of the Group of Seven rich nations to discuss pandemic fallout, climate change and digital taxation.
Britain joins Canada, France, Germany, Italy, Japan and the United States for the group’s first gathering since Joe Biden was elected US president.
Elsewhere, oil prices were on the up even as uncertainty persists over how far demand will recover from last year’s plunge.
With the newly-vaccinated eager to travel, “the crude demand outlook looks like it could get its best-case scenario as Americans who want a Covid vaccine will be able to get it by April”, OANDA’s Moya said.
With most of Asia closed for the Lunar New Year holiday, business was limited.
Tokyo and Wellington both fell, while Sydney was also hit by news of snap virus lockdown in Melbourne.
The pan-European STOXX 600 index closed up 0.6% at a three-week high for a second straight week of gains.
ASML Holding NV rose 3% after the Dutch equipment maker said the chip shortages slowing car production were a symptom of a broader increase in demand.
The world’s biggest cosmetics group L’Oreal hit a three-month high after forecasting a strong rebound in makeup sales.
Germany’s DAX underperformed, ending flat as carmaker Volkswagen slipped 0.7% after the company said deliveries slid in January.
Gains in Spain’s IBEX were capped after data showed consumer prices rising slightly below expectations in January.
ING Group NV jumped 6.7% after the largest Dutch bank reported better-than-expected quarterly pre-tax earnings of 1.05bn euros ($1.27bn). Analysts expect growth in corporate earnings this year, driven by stimulus-induced liquidity, but are wary of next year as the measures may start to fade.
Market participants were hopeful that a proposed $1.9tn US stimulus bill would be passed soon by lawmakers, with a stalling recovery in the US labour market strengthening the case for it.
“We’re still not out of the woods...and the market is potentially overdue a reckoning,” said Connor Campbell, analyst at spreadbetter Spreadex.
“Once the (US stimulus) package has been implemented, it will be interesting to see how markets will behave, as they will no longer have this big thing to cling on to.”
The STOXX 600 is about 5% away from its peak of February 2020 after rallying 50% since a crash in March, aided by historic monetary and fiscal stimulus and the rollout of Covid-19 vaccines.
“We believe a hospitalisation rate low enough to enable sustainable reopening and economic recovery can be achieved by April in the US and by June in Europe,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.
Britain’s coronavirus-ravaged economy shrank 9.9% in 2020, the biggest annual fall in output since modern records began, but it avoided heading back towards recession at the end of last year, data showed.
In London, the FTSE 100 closed up 0.9% to 6,589.79 points; Frankfurt – DAX 30 ended up less than 0.1% to 14,049.89 points; Paris – CAC 40 closed up  0.6% to 5,703.67 points and EURO STOXX 50 ended up 0.7% to 3,695.61 points yesterday.