Tuesday, 6 October 2009

GLOBAL MARKETS: European Stocks Up; Banks Offer A Timely Lift

GLOBAL MARKETS: European Stocks Up; Banks Offer A Timely Lift

Tue, Oct 6 2009, 08:19 GMT
http://www.djnewswires.com/eu

GLOBAL MARKETS: European Stocks Up; Banks Offer A Timely Lift

By Andrea Tryphonides
Of DOW JONES NEWSWIRES


DATA SNAP: UK Halifax House Prices Rise Again In September


Tue, Oct 6 2009, 08:25 GMT
http://www.djnewswires.com/eu

DATA SNAP: UK Halifax House Prices Rise Again In September

By Nicholas Winning
OF DOW JONES NEWSWIRES


LONDON (Dow Jones)--U.K. house prices rose for a third consecutive month in September and posted their first quarterly rise for two years in the third quarter, HBOS, a unit of the Lloyds Banking Group, said Tuesday.

The company's Halifax house price index rose 1.6% in September from August, following a 0.8% monthly increase in August. The average price in the three months to the end of September was 7.4% lower than in the corresponding period of last year, down from an annual 10.1% drop in August.

The data are stronger than the market consensus estimate of a 1.0% gain on the month and a 7.7% drop on the year from a Dow Jones Newswires survey of economists last week.

The global credit crisis and ensuing recession throttled activity on the U.K.'s house market and dragged prices lower last year. Although the market still faces headwinds from rising unemployment and a shortage of mortgages, prices have started to recover in recent months with support from a combination of pent-up demand and a shortage of property for sale.

Company Web site: www.halifax.co.uk

-Nicholas Winning, Dow Jones Newswires; +44 207 842 9498; nick.winning@dowjones.com

Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=ayP1X7kVnr7MWhQ1SnmXpA%3D%3D. You can use this link on the day this article is published and the following day.

(END) Dow Jones Newswires

October 06, 2009 04:25 ET (08:25 GMT)


Copyright 2009 Dow Jones & Company, Inc.





LONDON (Dow Jones)--European stocks climbed higher Tuesday, supported by a strong performance in the banking sector, while news of Societe Generale's EUR4.8 billion rights issue helped boost confidence in the recovery of fortunes for Europe's blue-chips.

Additionally, the U.K.'s largest retailer, Tesco, reported better than expected profit growth, which supported those who think that economic recovery in the U.K. and beyond is more than just a pipe dream.

"Earnings momentum is starting to pick up, valuations are reasonable and it can hardly be said that investor sentiment is too positive," said Bob Doll, chief investment officer of equities at BlackRock.

"Together, all of these factors support our view that the current cyclical bull market remains intact," he said.

By 0800 GMT, the pan-European Stoxx 600 index was up 0.8% at 238.0. London's FTSE 100 was up 0.7% at 5059.8, Frankfurt's DAX gained 0.7% to 5545.2 and Paris's CAC-40 was 0.6% higher at 3695.4.

Much of the morning's focus was on the banking sector after Societe Generale launched a rights issue, partly to repay state funds and using the remainder to buy out a 20% stake in Credit du Nord and boost capital ratios. It fell 0.8% to EUR51.8, although it soon came off its lows.

"New confidence in the banking sector and the desperate desire to rid themselves of the shackles of government ownership is driving these decisions," said Manoj Ladwa, senior trader at ETX Capital.

Additionally, BofA-Merrill Lynch upgraded the European bank sector to overweight. It said that with further EPS upgrades ahead, reasonable valuations offer the potential for re-rating, building on strong core profitability and positive trends in key wholesale and property markets. The Stoxx Europe banks sub-sector was up 1.4% at 229.6.

Elsewhere, Tesco, the world's third-largest retailer by sales, reported better than expected profit growth, with pretax profit before exceptional items up 8.6% to GBP1.57 billion. However, it fell 0.8% to 388 pence, with analysts still noting an air of caution, particular with regards to the U.S. business.

Earlier, Asian equity markets mostly advanced Tuesday, inspired by solid gains for U.S. stocks, although some markets slipped off earlier highs or were trading lower.

Japan's Nikkei 225 finished up 0.2% but South Korea's Kospi Composite failed to turn its fortunes around and ended 0.5% lower. Hong Kong's Hang Seng index gained 1.9%.

Australia's S&P/ASX 200 ended 0.4% higher, although the index dipped a little after the Reserve Bank of Australia hiked its key cash rate by 25 basis points to 3.25%, becoming the first central bank among the Group of 20 nations to begin monetary tightening.

In the U.S., an analyst upgrade of the banking sector and earnings-driven speculation drove a rallying stock market Monday, with Wells Fargo, Alcoa and Caterpillar leading the tape.

For the session, the DJIA gained 1.2% to 9599.8, snapping a four-day losing streak.

Goldman Sachs raised its rating on large banks to attractive Monday morning. Improved earnings, stronger balance sheets and bigger assets following a year's worth of acquisitions at several large banks have raised some analysts' views of the sector going into the quarterly reports.

Among other indexes, the Standard & Poor's 500 rose 1.5% to 1040.5 and the Nasdaq Composite increased 1.0% to 2068.2.

In the foreign exchanges, the dollar fell against the euro and the yen as risk appetite increased and Australia raised interest rates. Market participants noted that a report that Gulf countries are planning to stop using the dollar for oil dealing was swiftly denied by various parties.

The euro was trading at $1.4720 at 0815 GMT, up from $1.4648 in late New York trade on Monday. The dollar was quoted at Y89.20, down from Y89.55.

Meanwhile, the November Nymex crude oil futures contract was up 55 cents at $70.96 per barrel. Spot gold surged, jumping to $1018.40 per troy ounce, up $7.80 from the New York close.

European government bonds were lower and, at 0815 GMT, December bund futures were down 0.15 at 122.55.

-By Andrea Tryphonides, Dow Jones Newswires; +44-20-7842-9281; andrea.tryphonides@dowjones.com

Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/access/al?rnd=ayP1X7kVnr7MWhQ1SnmXpA%3D%3D. You can use this link on the day this article is published and the following day.

(END) Dow Jones Newswires

October 06, 2009 04:19 ET (08:19 GMT)


Copyright 2009 Dow Jones & Company, Inc.

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