Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

EUROPE MARKETS: Europe Stocks Jump After German Ifo Data

02/22/2013 | 11:04am US/Eastern
Recommend:
0

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) -- A surprisingly upbeat reading on Germany's business climate sent European stock markets toward weekly gains on Friday, with investors also paying close attention to Italian elections over the weekend.

The Stoxx Europe 600 index rallied 1% to 287.62, climbing back after a 1.5% drop on Thursday.

European stock markets were on track for nudging out a 0.1% weekly gain, following a week of sharp swings as investors worried about the outcome of the Italian election on Sunday and Monday. Global financial markets have moved broadly higher this year, blessed with a strong risk-on sentiment as signs of economic recovery lift investors' spirits. However, mixed European data and worries over the U.S. Federal Reserve monetary-easing program sent markets wobbling this week.

"I think investors have been slightly unclear about what direction to take ahead of the Italian election this weekend. There's a lot of uncertainty," said Guy Foster, head of portfolio strategy at Brewin Dolphin.

"Yesterday, you had the minutes from the Fed and investors are always desperate for signs about what will happen to quantitative easing. They are looking for a ghost that is not really there. The minutes didn't really suggest anything new, but it just happened in addition to no other good news that day," he added. "Investors are thinking this is a good opportunity and are taking advantage of the little window that has opened."

Among notable movers in the pan-European index, shares of Elan Corporation PLC rose 4.3%. The biotech firm said it would buy back $1 billion of its own shares, using money from the sale of its multiple-sclerosis drug Tysabri.

Pointing in the other direction, shares of Air France-KLM dropped 6.9%, after the airline said its loss widened in 2012 compared to 2011

For the broader European stock market, upbeat data out of Germany helped lift the trading mood. The Ifo Business Climate index jumped to 107.4 in February, exceeding expectations of a 104.7 reading.

Investors also trained their attention on general elections in Italy over the weekend, with worries a new government possibly led by former Prime Minister Silvio Berlusconi will fail to follow up on the country's current reformist drive. Several parties including Berlusconi's have openly campaigned against the austerity measures the nation had to implement in order to meet its EU commitments.

"The market is currently pricing in a rather constructive election outcome, in our view. However, we still see a realistic risk either of a hung parliament, or a potentially difficult and protracted negotiation process as [centre-left candidate Pier Luigi] Bersani and [Prime Minister Mario] Monti seek to form a coalition," analysts at RBC Capital Markets said in a note.

"That leaves us remaining cautious about peripheral exposure in outright terms and in [yield spreads between Italian government bonds and German bunds] in the near term," they said.

Polls aren't allowed in the final weeks leading up to the election in Italy, but polls published before the cutoff date put a center-left coalition led by Bersani in the lead.

Italy's FTSE MIB index posted steep losses this week, on track for a 1.9% weekly loss, but was up 1% to 16,173.56 on Friday.

Among other country-specific indexes, France's CAC 40 index added 1.5% to 3,680.44, with banks on the rise. Shares of Société Générale SA rose 1.2% and BNP Paribas SA gained 1.7%.

Shares of Alcatel-Lucent slipped 1.1% after the telecom-equipment maker appointed Michel Combes, former head of Vodafone Group PLC's (>> Vodafone Group plc) European operations, as new chief executive. Additionally, HSBC lifted the stock to neutral from underweight.

In Germany, Deutsche Bank AG (>> Deutsche Bank AG) climbed 1.2%. The DAX 30 index traded 0.6% higher at 7,631.33.

And in the U.K., J Sainsbury PLC gained 1.9%, after Citigroup lifted the supermarket retailer to buy from neutral.

The FTSE 100 put on 0.4% to 6,318.77.

Subscribe to WSJ: http://online.wsj.com?mod=djnwires

Stocks mentioned in the article : Vodafone Group plc, Deutsche Bank AG
Recommend :
0
React to this article
Latest news
Date Title
<1m ago BINDURA NICKEL : BNC Seeks National Project Status Nod
<1m ago SASOL : Banyana Banyana Geared for Tanzania Contest
<1m ago CAPITAL STAGE : Operational profitability significantly increased in the first half year (DGAP News)
<1m ago EXOVA : Shares Lead FTSE 350 Fallers On Wider Half-Year Loss
<1m ago Interim report April – June 30, 2014
<1m ago CANDENTE GOLD : Provides Voting Results for the Election of Directors and Confirms Filing of 43-101 Report on Inferred Resource Estimate
1m ago MR PRICE : Robbers hit clothing shop
1m ago Kenya firm's profit tumbles
1m ago ESSO : DCC bullish after Esso deal
1m ago AFREN : directors suspended
Latest news
Advertisement
Hot News 
ADL PARTNER : 08/28/2014 - ADLPartner: EARNINGS GROWTH FOR THE FIRST HALF OF 2014
REALDOLMEN : First quarter 2014-2015 trading update
PAN AFRICAN RESOURCES : Trading Statement & Dividend Guidance
BALOISE : Sale of Basler Austria completed
BWIN PARTY DIGITAL ENTERTAINMENT : 2014 Half Year Dividend
Most Read News
1d ago CARTER : Announces Participation at the Goldman Sachs Global Retailing Conference
1d ago UR ENERGY : Completes Technical Report on Shirley Basin Uranium Project
1d ago VIRGIN AUSTRALIA : annual net loss triples, forgoes guidance
1d ago WELLS FARGO : CEO Shares Company Role in Community and Environment
1d ago ROYAL GOLD USA : Announces Fourth Quarter Dividend
Most recommended articles
1m ago Strong margins boost laundry firm Berendsen's profit
4m ago UK regulator proposes 5 percent cut in water bills by 2020
4m agoDJGerman July Retail Sales Post Largest Decline in Since 2012
7m ago State fund says MAS' contracts could be amended by parliament
9m ago SALVATORE FERRAGAMO ITALIA : Shares in Ferragamo up 5 percent after second quarter core profit beats fcasts
Dynamic quotes  
ON
| OFF