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European stocks extend gains, focus on Greece; DAX jumps 1.23%

Published 02/15/2012, 07:15 AM
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Investing.com - European stock markets remained higher on Wednesday, as market sentiment improved after China said it would increase its investment and support the euro zone, while traders awaited further developments surrounding Greece.

During European afternoon trade, the EURO STOXX 50 climbed 1.09%, France’s CAC 40 surged 1.09%, while Germany’s DAX 30 jumped 1.23%.

Market sentiment was boosted after the head of China’s central bank said he believes the euro zone’s debt crisis can be solved and said that China will become more involved in efforts to resolve the crisis through mechanisms such as the European Financial Stability Facility.

Euro zone finance ministers cancelled a meeting planned for later Wednesday to sign off on Greece’s bailout, after failing to receive assurances on how Athens plans to implement austerity measures approved in a parliamentary vote on Sunday. However, the ministers were expected to hold a teleconference ahead on a meeting on Monday.

France’s largest lender BNP Paribas led gains with shares surging 6.94% after completing what it called a "good performance despite the Greek sovereign-debt impairment."

Elsewhere across the sector, Societe Generale shares climbed 4.29%, Italy’s Unicredit jumped 4.13%, while Deutsche Bank added 2.53%.

Meanwhile, Danone, the world’s biggest yogurt maker, advanced 1.75% after reporting a 4.5% gain in 2011 earnings, helped by growth in infant nutrition and bottled water products.

On the downside, Swisscom, Switzerland’s biggest phone company tumbled 1.04% after predicting lower revenue in 2012 and posting its first quarterly loss in almost a decade on a writedown of Italian fixed-line unit Fastweb SpA.

Elsewhere, in London, FTSE 100 rose 0.27%, ahead of the release of the Bank of England’s cast doubts over the possibility of further quantitative easing in its February inflation report after it raised its inflation forecast for two years time to a higher-than-expected 1.8%.

British lenders extended earlier gains, with Barclays soaring 3.38% and Royal Bank of Scotland shares jumping 3.19%, HSBC Holdings rising 2.55% and Lloyds Banking trading up 1.55%.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a gain of 0.58%, S&P 500 futures signaled a 0.62% advance, while the Nasdaq 100 futures indicated an increase of 0.62%.

Also Wednesday, official data showed that Germany’s economy contracted by a less-than-expected 0.2% in the final three months of 2011, France’s economy expanded 0.2%, confounding expectations for a 0.2% contraction, while Italy’s economy shrank by 0.7%.

Later in the day, the U.S. was to release a report on manufacturing activity in the New York-region as well as industrial production data.


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