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European stocks higher ahead of Greek deal; DAX up 0.77%

Published 03/08/2012, 03:48 AM
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Investing.com - European stock markets were sharply higher on Thursday, as sentiment found support amid hopes for a successful Greek debt swap deal later in the day.

During European morning trade, the EURO STOXX 50 gained 0.80%, France’s CAC 40 jumped 1.08%, while Germany’s DAX 30 advanced 0.77%.

Prospects for a successful Greek deal rose after a group of major banks and funds said they would take part in the swap. As of late Wednesday, about 52% of the EUR206 billion bonds up for restructuring had been pledged.

A positive outcome should clear the way for a bailout package and help Greece avert a messy debt default.

Financial stocks were sharply higher, led by Dutch lender ING Group whose shares surged 2.62%.

France’s Societe Generale and BNP Paribas climbed 2.40% and 1.98% respectively, while German Deutsche Bank and Commerzbank jumped 2.32% and 2.22%.

Meanwhile, EADS, the maker of Airbus passenger jets skyrocketed 9.33% after agreeing to pay a dividend of 45 cents a share, more than doubling the payout from last year and exceeding analyst estimates of a 30-cent dividend.

Deutsche Post also added to gains as shares climbed 1.97% after Europe’s largest postal service said profit in 2012 will rise as much as 6.6% thanks to growth in global trade.

In London, commodity-heavy FTSE 100 climbed 0.59%, boosted by strong gains in the mining sector.

Mining giants Rio Tinto and Bhp Billiton led gains, with shares jumping 1.69% and 1.62% respectively, while copper producers Xstrata and Kazakhmys were also on the upside, advancing 1.09% and 2.49%.

Meanwhile, U.K. lenders tracked their European counterparts higher. Shares in HSBC Holdings added 0.64% and Lloyds Banking rose 0.60%, while Barclays and the Royal Bank of Scotland gained 0.75% and 0.54%.

Elsewhere, insurance company Aviva rallied 2.16% after the company said its operating profit fell 2% to GBP2.5 billion.

In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a rise of 0.28%, S&P 500 futures signaled a 0.33% increase, while the Nasdaq 100 futures indicated a 0.25% gain.

Later in the day, the European Central Bank was to hold its policy setting meeting, which was to be followed by a closely watched press conference.

Meanwhile, Germany was to release official data on industrial production and the U.S. was to produce government data on initial jobless claims.


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