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European stocks open sharply higher after broad sell-off; Dax up 1%

Published 06/25/2013, 03:37 AM
Updated 06/25/2013, 03:47 AM
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Investing.com - European stocks opened sharply higher on Tuesday, rebounding from a broad sell-off after last week's comments by Federal Reserve Chairman Ben Bernanke saying that the bank may taper its stimulus program before the year end.

During European morning trade, the EURO STOXX 50 rallied 1.02%, France’s CAC 40 gained 1.13%, while Germany’s DAX 30 jumped 1%.

Stocks came under pressure after Fed Chairman Ben Bernanke said Wednesday the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy continues to pick up.

However, Narayana Kocherlakota, president of the Federal Reserve Bank of Minneapolis, on Monday said the central bank was committed to continuing its bond purchase program until the U.S. unemployment rate falls further.

Meanwhile, investors also remained cautious amid sustained concerns over financial stability in China, as Chinese equities posted their largest daily decline in nearly four years on Monday.

Financial stocks were broadly higher, as French lenders BNP Paribas and Societe Generale surged 2.32% and 1.28%, while Germany's Deutsche Bank climbed 0.46%.

Peripheral lenders added to gains, with Spanish bank Banco Santander ans BBVA rallying 1.65% and 1.91%, while Italy's Unicredit and Intesa Sanpaolo jumped 2.04% and 2.27%.

In London, FTSE 100 advanced 0.73%, as U.K. lenders tracked their European counterparts higher.

Shares in the Royal Bank of Scotland jumped 1.16% and Lloyds Banking rallied 1.52%, while HSBC Holdings and Barclays surged 1.64% and 1.72%.

Mining stocks were also on the upside, as Rio Tinto and BHP Billiton gained 1.37% and 1.39% respectively, while Anglo American and Vedanta Resources jumped 1.81% and 2.24%.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.47% increase, S&P 500 futures signaled a 0.56% climb, while the Nasdaq 100 futures indicated a 0.54% gain.

Later in the day, the U.S. was to release official data on durable goods orders and reports on home sales and consumer confidence.


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