Breaking News

Europe stocks rally as British recession eases

European equities rallied Friday, boosted by some better-than-expected company news and data showing that the British recession was not as deep as expected in the second quarter, analysts said.

London’s FTSE 100 index closing 0.81 percent higher at 4,908.9 points.
In Paris the CAC 40 closed 1.22 percent higher at 3,693.14 points, buoyed by company results, and Frankfurt’s DAX rose 0.86 percent to close at 5,517.35 points.

The DJ Euro Stoxx 50 index of leading eurozone shares jumped 0.90 percent to 2,802.71 points.
British gross domestic product (GDP) shrank 0.7 percent in the second quarter of 2009 compared with the first three months of the year, official data showed on Friday.
That was a modest improvement on the previous estimate of a 0.8-percent contraction.

The Office for National Statistics said the economy shrank 5.5 percent in the second quarter on a year-on-year basis, which was also a slight upgrade, but remained the biggest drop since records began in 1955.
“UK second-quarter GDP (was) pretty much in line with expectations, which will provide some relief to the market,” said trader Arifa Sheikh-Usmani at betting firm Spreadex.

London’s mining sector was also lifted on Friday by broker upgrades for Kazakhmys and Xstrata, which rallied 5.50 percent and 4.36 percent, to stand at 988.50 pence and 826.50 pence respectively.
In Paris, French supermarket giant Carrefour, ranked world number two, said Friday it had slipped into the red for the first half in difficult times but still confirmed its 2009 earnings targets.

The company, second only to Wal-Mart of the United States, posted a net loss of 58 million euros (83 million dollars) in the six months to June after taking exceptional charges of 511 million euros.
However, investors set aside the news, sending the group’s share price 4.58 percent higher at 33.100 euros.
US stocks traded mixed Friday as the market reacted to lacklustre economic data along with upwardly revised forecasts from computer chipmaking giant Intel Corp and PC maker Dell.

The blue-chip Dow Jones Industrial Average was down 0.44 percent to 9,538.38 in early trade. The tech-heavy Nasdaq composite climbed 0.25 percent to 2,032.33. The Standard  Poor’s 500 shed 0.24 percent to 1,028.49.
Commerce Department data showed consumer spending — which drives two-thirds of US economic activity —  rose 0.2 percent in July but personal income was flat compared with analysts’ expectations of a 0.1 percent rise.
“We got our first look at how the economy is performing in the third quarter and it is not all that pretty,” said analysts at in a report.
Tim Hughes, a trader at IG Index, said: “After a day of positive movements, a better start for the US market may have seen the FTSE 100 track higher and reach the psychological 5000 point.

“But in the end, traders may have to wait until after the bank holiday weekend (which runs from Saturday to Monday) to crack that particular nut.”
Among other rising markets in Europe, Madrid’s Ibex-35 index rose 0.76 percent at 11,442.70 points, Milan’s FTSE Mib 0.88 percent to 22,673 and Amsterdam’s AEX 1.11 percent to 300.20.
The Swiss Market Index rose 0.69 percent to 6,211.58 points and the Bel-20 in Brussels 0.75 percent to 2,393.66.


Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.