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European stocks boosted by Greece optimism; DAX up 1.2%

Published 06/29/2011, 05:00 AM
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Investing.com – European stock markets were broadly higher on Wednesday, as shares in the financial sector advanced amid expectations Greek lawmakers will vote in favor of harsh austerity measures needed to avoid a sovereign debt default.

During European morning trade, the EURO STOXX 50 jumped 1.1%, France’s CAC 40 gained 1.05%, while Germany's DAX 30 advanced 1.2%. 

Later in the day, Greece's Parliament was to vote on a EUR28.4 billion, five-year austerity package needed to secure a EUR12 billion tranche of bailout funds from the European Union and International Monetary Fund.

Socialist deputy Thomas Robopoulos said earlier that he would vote for the plan, backtracking from comments made last Friday.

Banking shares posted strong gains, with French lenders BNP Paribas and Societe Generale up 1.95% and 2.3% respectively, while Germany’s Commerzbank advanced 2.75%.

Peripheral lenders were also higher, with the National Bank of Greece rallying 4.7%, Spain’s Banco Santander climbing 2.2%, while Italy’s second largest bank Intesa Sanpaolo rose 2.15%.

Shares in Europe’s largest insurer Allianz advanced 2.5% after Morgan Stanley upgraded the stock to ‘overweight’.
 
In London, the commodity-heavy FTSE 100 advanced 1.1% as shares in raw material producers led gains after oil and metal prices advanced, boosting earnings prospects for miners and energy explorers.

The world’s largest mining group BHP Billiton saw shares gain 1.6%, rival Rio Tinto added 1.45%, while copper producer Antofagasta saw shares rally 4.1%, following upbeat comments by its chief executive. 

The world’s largest commodities trader Glencore International climbed 1.1% after both UBS and Citigroup recommended buying the stock.

The outlook for U.S. equity markets was upbeat. The Dow Jones Industrial Average futures pointed to a gain of 0.2%, S&P 500 futures advanced 0.25%, while the Nasdaq 100 futures edged 0.3% higher.    

Later Wednesday, the U.S. was to publish industry data on pending home sales as well as a report on crude oil inventories.

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