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European stocks rise on Ireland rescue package; DAX gains 0.12%

Published 11/29/2010, 05:31 AM
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Investing.com – European stocks advanced on Monday, as market sentiment was boosted after a weekend agreement was reached on a rescue package for Ireland, while U.S. futures indexes pointed to a higher open on Wall Street.

During European morning trade, the EURO STOXX 50 rose 0.22%; France’s CAC 40 gained 0.14%; while Germany's DAX was up 0.12%.

On Sunday, European Union finance ministers endorsed a EUR 85 billion loan package to shore up Ireland’s public finances and tackle its stricken banking sector.

Shares in the financial sector performed strongly following the news. Spain’s largest lender Banco Santander saw shares jump 2.23%, rivals BBVA saw shares leap 2.18%, while shares in France’s second-largest lender Societe Generale surged 2.26%.

Meanwhile, shares in British lenders soared as most British banks have extensive liabilities in Ireland. Shares in the Royal Bank of Scotland soared 1.66%, Britain’s second-largest lender Barclays saw shares jump 1.69%, while shares in Lloyds Banking Group leaped 1.44%

Elsewhere, shares in the world’s largest maker of metal cutting tools Sandvik jumped 2.32% after JP-Morgan Chase upgraded the stock to ‘overweight’.

In London, the commodity-heavy FTSE 100 climbed 0.25% as metal and crude oil prices rebounded. Shares in the world’s largest mining group BHP Billiton rose 1.10%, rivals Rio Tinto saw shares climb 1.30%, while copper producer Xstrata saw shares leap 1.11%.

Meanwhile, shares in oil and gas giant British Petroleum jumped 1.25% after it agreed to sell its stake in Argentina-based oil and gas producer Pan American Energy for approximately USD 7.06 billion to Bridas Corporation.

The outlook for U.S. equity markets, meanwhile, was upbeat. The Dow Jones Industrial Average futures pointed to a gain of 0.70%, S&P 500 futures indicated a rise of 0.78% and Nasdaq 100 futures indicated an increase of 0.65%.

Earlier in the day, German Finance Minister Wolfgang Schaeuble said that his country was hopeful that the aid package agreed for Ireland would calm euro zone financial markets. He added that Portugal was on track to implement a tough plan of fiscal austerity that should allow it to avoid a bailout.


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