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European stocks remain higher on Greece optimism; DAX up 0.61%

Published 02/08/2012, 07:26 AM
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Investing.com - European stock markets were higher on Wednesday, amid hopes that Greece will finally secure the second bailout package it needs to avoid a sovereign debt default.

During European afternoon trade, the EURO STOXX 50 rose 0.45%, France’s CAC 40 climbed 0.34%, while Germany’s DAX 30 jumped 0.61%.

Greek Prime Minister Lucas Papademos was to hold talks with the leaders of Greece's three political parties later in the day to discuss the terms of new austerity measures being demanded in return for a second bailout worth EUR130 billion to prevent the country from defaulting.

Greece needs to finalize a debt restructuring deal by early March as part of an agreement to receive a second bailout package.

Financial stocks extended earlier gains, led by Italian Unicredit whose shares surged 5.71%, while Germany’s Deutsche Bank and Commerzbank jumped 1.97% and 7.53% respectively.

Meanwhile, Nexans soared 7.34% as the world’s second-largest maker of cables and wires reported an increase in its 2011 operating profit margin and predicted further revenue growth this year.

On the downside, Mobistar sank 10.25% after Belgium’s second-biggest mobile-phone company forecast that the decline in its profit will accelerate this year, missing analysts’ estimates.

The world’s biggest salmon farmer, Marine Harvest, also dropped 1.67% after the company predicted a “challenging supply situation” in 2012.

In London, FTSE 100 edged up 0.01%, supported by gains in financial stocks.

Shares in Lloyds Banking surged 2.45% and the Royal Bank of Scotland jumped 1.39%, while HSBC Holdings and Barclays added 0.77% and 0.57% respectively.

Mining giant Rio Tinto also contributed to gains with shares climbing 1.49%, while copper producers Xstrata and Kazakhmys jumped 1.33% and 1.68%.

Elsewhere, Reckitt Benckiser soared 3.13% after the maker of Nurofen painkillers and Dettol kitchen spray said 2012 sales will increase at a faster pace than the industry after reporting fourth-quarter earnings that beat estimates.

In the U.S., equity markets pointed to a moderately higher open. The Dow Jones Industrial Average futures pointed to a rise of 0.12%, S&P 500 futures signaled a 0.01% gain, while the Nasdaq 100 futures indicated a 0.11% increase.

Also Wednesday, official data showed that German exports fell at their fastest rate in nearly three years in December, narrowing the trade surplus to EUR13.9 billion from a revised EUR14.9 billion the previous month.

The data sparked concerns that the official fourth quarter estimate for an economic contraction of 0.25% may have to be revised down.


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