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European Markets Summary

London Stocks End With Solid Gains

FTSE 100 closes up 1.9% at 5403.28, with miners pacing the advance amid signs that Chinese authorities may act to boost growth. Fresnillo +5.2% and Antofagasta +4.5%. Investors adopt an optimistic view ahead of Wednesday’s EU summit, hoping that euro-zone leaders will agree more measures to tackle the region’s debt crisis. Capital Spreads says the summit “is expected to see some more pressure applied to Greek voters to accept the austerity measures being imposed on them to avoid exiting the euro zone.” At the same time, “there’s hope that common ground will be agreed as to how to build a proper firewall around Greece should the worst-case scenario occur.” Wednesday, UK retail sales and CBI industrial trends are at 0830 GMT and 1000 GMT, respectively. US new home sales are at 1400 GMT.

Frankfurt Stocks Close Markedly Higher

DAX closes 1.7% higher at 6435.60 amid growing optimism ahead of a meeting of EU leaders Wednesday, at which further backstop measures against the debt crisis will be discussed. Better-than-expected US pending home sales data released in Europe’s afternoon, also helped the positive mood. The main stock movers include HeidelbergCement, which finishes 4.7% higher on hope that China will do more to drive growth, targetting specific sectors like infrastructure. The automobile sector is also strong with Daimler closing 3.1% higher and BMW up 2.9%.

Paris Stocks Close Markedly Higher

CAC-40 closes 1.9% higher at 3084.09, as bargain hunting continues and investors are more hopeful about the euro-zone situation, says a Paris-based trader. “Germany seems to be more isolated in its reluctance to create euro-zone bonds,” the trader says, ahead of a much awaited EU Summit on Wednesday at which further backstop measures for Europe’s sovereign debt crises will be discussed. Stronger than expected U.S. home-sales data also help to support the positive trend. In French stocks STMicroelectronics leads, gaining 8.6%. And Accor gains 5.8%, after agreeing to sell its Motel 6 chain.

Amsterdam Stocks Close Higher

AEX is 1.9% higher at 295.95, marking a second-straight day of gains after negative sentiment last week. Bargain hunters are active traders say. Sentiment is supported by optimism about the EU Summit coming up on Wednesday, with expectations that further measures to bolster Europe’s sovereign debt, will be discussed. As for leading stocks, PostNL stands out with a 12% gain. It’s being picked-up relatively cheaply after losing almost half its value in the past three months. And ING Groep, TomTom and Aegon, all post gains of more than 5% each. Only three stocks are lower, albeit modestly. These are led by Wolters Kluwer which is down 0.6%.

Zurich Stocks Close Firm, Helped By Financials

SMI closes up 1.6% at 5910.20, led by strong gains across the board, particularly in the financial sector, as worries about Europe’s debt crisis pause, ahead of another EU Summit Wednesday, at which it’s hoped the issue of joint European bonds will be discussed. Credit Suisse is the day’s biggest riser, gaining 3.9%, while UBS rises 3.2%. Both respond positively to falling bond yields in Italy and Spain, traders say, as does insurer Swiss Life, shares of which gain 2.8%. “Many stocks have been oversold and now there is a positive reaction,” says a trader. That trader also notes gains by defensive stocks like Nestle, Roche and Novartis and strengthening cyclicals too. They lost more during the recent downturn than stocks in other sectors.

Nordic Stocks Close Higher

Nordic markets close higher Tuesday, as investors appear slightly more optimistic ahead of Wednesday’s EU summit in Brussels and sentiment stays positive after China signaled it would focus on measures to promote growth. OMXN40 closes 2.3% higher at 925.53, OBX up 1.8% at 371.59. Cyclical stocks rebound sharply after the recent selloff, with Atlas Copco 4.7% higher and Sandvik up 3.9%. Additionally, Topdanmark is 5.3% higher after the company reported rising net profit with a raised earnings forecast for 2012.

Milan Stocks Close Sharply Higher

FTSE Mib closes 3.4% higher at 13456.03, bouncing back from recent lows amid hopes ahead of Wednesday’s EU Summit, at which possible coordinated moves by euro-zone leaders to help fight Europe’s debt crisis may be discussed. Better-than-expected US home sales data released in the afternoon also help sentiment. The major stock gainers include Fiat, which is 6.4% higher, following news that Brazil will provide incentives to encourage car purchases.

Athens Stocks Close Markedly Lower

ASE ends down 1.6% at 535.96, significantly underperforming its European peers, amid ongoing political uncertainty. Bank stocks buck the trend, however, with Alpha Bank up 2.9% and Piraeus Bank up 0.9%, after senior bank officials said Greece’s banks will get a much-delayed EUR18 billion temporary lifeline by the end of this week. Investors will look to Wednesday’s EU summit for further direction, at which the idea of jointly-guaranteeed euro-zone government bonds will be discussed. “Europe may eventually come out with huge intervention this summer but it’s unlikely…before the EU leaders know which way the political wind is blowing in Greece,” says Deutsche Bank.

Prague Stocks Close Higher

PX closes 1% higher at 882.3 as local buying appetite tracks rises on markets throughout Europe, as investors are bullish ahead of Wednesday’s EU summit, at which growth-boosting measures are likely to be proposed, a trader says. NWR closes 1.7% higher and partially recovers from selloff Monday, though CEZ closes down 0.1% after rising 2.3% yesterday. “Momentum today is coming from European sentiment; banks are benefiting from big gains by peers in Western Europe,” the trader notes. Erste bank is up 2.2% and Komercni Banka rises 0.4%.

 

StockMarketNews Research Team 

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