European shares rise in early trade, banks gain
Friday, 4 December 2009
LONDON, Dec 3 (Reuters): European shares rose in early trade Thursday, building on gains in the previous two sessions, with banks up after Bank of America said it would repay government debt.
At 0810 GMT, the FTSEurofirst index of top European shares was up 0.8 per cent at 1,023.67 points.
The European benchmark is up more than 58 per cent from its lifetime low of March 9, as investors have become more confident on the prospects for economic recovery.
Banks rose after Bank of America Corp said it would repay $45 billion of taxpayer bailout funds.
Banco Santander, Barclays, Commerzbank, Lloyds, Societe Generale, UBS and UniCredit rose between 1.2 and 2.7 per cent.
"Bank of America paying back its debt is positive," said Bernard McAlinden, investment strategist, at NCB Stockbrokers. Siemens, the world's top maker of industrial robots, fell 1.2 per cent after saying it expects its operating profit to decline this fiscal year after a hefty writedown on its struggling networks unit pushed it to a fourth-quarter net loss.
Japan's Nikkei average climbed 3.8 per cent Thursday to hit its highest close in five weeks.
Mitsubishi Motors Corp soared 13.5 per cent after the Nikkei business daily reported that PSA Peugeot Citroen is in talks to spend up to 300 billion yen ($3.4 billion) to acquire a 30-50 percent stake. Peugeot rose three per cent.
Later in the session, investors' attention will turn to the statement from the European Central Bank. The ECB will keep its key rate on hold at a record low of one per cent, according to all 80 economists.
The ECB will also update the market with its forecast for growth and inflation.
"They may decide to make their liquidity provision less generous, but that's not a signal that they're going to raise interest rates soon," said McAlinden.
At 0810 GMT, the FTSEurofirst index of top European shares was up 0.8 per cent at 1,023.67 points.
The European benchmark is up more than 58 per cent from its lifetime low of March 9, as investors have become more confident on the prospects for economic recovery.
Banks rose after Bank of America Corp said it would repay $45 billion of taxpayer bailout funds.
Banco Santander, Barclays, Commerzbank, Lloyds, Societe Generale, UBS and UniCredit rose between 1.2 and 2.7 per cent.
"Bank of America paying back its debt is positive," said Bernard McAlinden, investment strategist, at NCB Stockbrokers. Siemens, the world's top maker of industrial robots, fell 1.2 per cent after saying it expects its operating profit to decline this fiscal year after a hefty writedown on its struggling networks unit pushed it to a fourth-quarter net loss.
Japan's Nikkei average climbed 3.8 per cent Thursday to hit its highest close in five weeks.
Mitsubishi Motors Corp soared 13.5 per cent after the Nikkei business daily reported that PSA Peugeot Citroen is in talks to spend up to 300 billion yen ($3.4 billion) to acquire a 30-50 percent stake. Peugeot rose three per cent.
Later in the session, investors' attention will turn to the statement from the European Central Bank. The ECB will keep its key rate on hold at a record low of one per cent, according to all 80 economists.
The ECB will also update the market with its forecast for growth and inflation.
"They may decide to make their liquidity provision less generous, but that's not a signal that they're going to raise interest rates soon," said McAlinden.