European Stocks Climb On EU Debt Deal
European stocks rallied on Thursday, with banks and miners leading the gainers, after European leaders agreed on a plan aimed at stemming the region’s debt crisis.
In a meeting late yesterday, EU officials agreed to enhance the region’s rescue fund to EUR 1 trillion, while persuading Greece’s private creditors to take 50 percent of the loss. The summit also approved a co-ordinated scheme to recapitalize banks across Europe to prevent the spread of debt contagion.
The Euro Stoxx 50 index of euro zone blue chippers is rallying 4.2 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is up 2.4 percent.
Around Europe, the German DAX and France’s CAC 40 are up over 4 percent each, while the U.K.’s FTSE 100 is rising 2.4 percent and Switzerland’s SMI is up 1.8 percent.
Deutsche Bank AG and Commerzbank AG, Germany’s largest lenders, are climbing 12-14 percent, Barclays is rallying 11 percent in London and Standard Chartered is up 4.9 percent.
BASF is rallying 3.5 percent after the German chemical giant said it expects significant sales growth for the group in 2011 despite the overall reduced oil production. Volkswagen is up 5.5 percent after reporting net profit that more than tripled in the third quarter amid surging demand for its cars.
Bayer is rallying 3.9 percent after the German healthcare and high-tech materials company reported a rise in its third-quarter net profit to 642 million euros from 285 million euros in the previous year.
In Paris, Michelin is climbing 4.6 percent after the tire maker reported an 11 percent increase in third-quarter sales and reaffirmed that sales volumes growth will trend towards 8 percent by year end.
Dassault Systèmes is up 4.6 percent after the company reported third-quarter net income attributable to equity holders of 76.4 million euros, up from 55.4 million euros a year ago.
France Telecom, called as France Telecom-Orange, is rising a percent after posting third-quarter revenues of 11.28 billion euros. Shares of ABB are declining half a percent after the Swiss engineering firm said third-quarter net income available to shareholders grew to $790 million from $774 million in the prior year.
Shares of mining giant BHP Billiton are climbing 5.6 percent in London, while those of rival Rio Tinto are up 6.8 percent.
On the economic front, U.K. retail sales declined in October from a year ago, but retailers expect a modest growth next month, the monthly Distributive Trades Survey from the Confederation of British Industry revealed Thursday.
Nearly 24 percent of survey respondents said sales volume increased, while 36 percent reported a fall, resulting in a balance of -11 percent for October, compared to -15 percent in the prior month. Looking ahead, a net 4 percent forecast sales volumes to increase next month. The survey was carried out between September 28 and October 19, covering 134 firms.