European stocks, euro climb before IMF meeting

Read the original news 

Báo Đầu Tư English - 34 month(s) ago 1 readings

European stocks, euro climb before IMF meeting

European stock markets and the euro were firmer on Friday after solid business confidence data from Germany and as investors looked ahead to a key IMF meeting and weekend French elections.

A trader looks at screens showing stock exchange share index in Paris, 2011. European stock markets rose and the euro gained against the dollar as investors looked ahead to a key IMF meeting and weekend French elections, and also kept watch over Spain.

At closing, London's benchmark FTSE 100 index of top companies fell 0.48 percent at 5,772.15 points, Frankfurt's DAX 30 rose 1.18 percent to 6,750.12 points and in Paris the CAC 40 gained 0.46 percent to 3,188.58 points.

Madrid rallied 2.01 percent and Milan 0.80 percent.

In foreign exchange trading, the euro firmed to $1.3211 from $1.3134 in New York late Thursday.

Wall Street shares also rose with the Dow Jones Industrial Average up 0.84 percent at around 1600 GMT, the broader S&P 500 gaining 0.69 percent and the tech-heavy Nasdaq rising 0.67 percent.

"With no major US economic data scheduled to be released, all eyes will be on the IMF and World Bank meeting in Washington starting today," said ETX Capital trader Markus Huber.

"While ahead of the meeting several countries have pledged substantial funds to increase the firepower of the IMF, there are still other important countries like Brazil and the UK who are not quite as forthcoming.

"Ongoing hesitation and wrangling about who should contribute what and how much might not prove very constructive as investors patience's could run out rather sooner than later."

IMF head Christine Lagarde said on Thursday that the crisis lender would get a significant boost to its intervention capacity this week as worries mounted that Spain might be the next eurozone country to seek a rescue.

Warning that "dark clouds" still hover over the global economy, she expressed confidence that International Monetary Fund members meeting in Washington would put up the funds needed for a "global firewall."

Traders said optimism came from a resilient Germany where business confidence beat expectations to rise for the sixth month in a row in April.

The Ifo economic institute's closely watched business climate index edged up to 109.9 points in April from 109.8 points in March, defying analysts' expectations for a slight decline.

It is the sixth month in a row that the barometer has risen and it now stands at its highest level since July 2011.

"The latest renewed increase ... signals once again that one should not underestimate the German economy and its resilience towards adverse effects," UniCredit economist Andreas Rees said.

"Despite the renewed flaring up of concerns about the European debt crisis, (German) companies have been steering the course," the analyst said.

Worries that Spain might be the next country to seek a bailout sparked new turmoil across the fragile eurozone and stung markets over the past week.

On Thursday, Madrid scraped through a key bond market test but failed to quash doubts over its future finances as the cost of its borrowing was pushed toward the 6.0 percent level seen as unsustainable.

The frontrunner in the race for the French presidency, Socialist candidate Francois Hollande, meanwhile Friday urged the European Central Bank to lower its interest rate to support growth.

France goes to the polls on Sunday to choose two candidates to contest a second-round presidential run-off on May 6. Hollande is the opinion poll favourite, on course to oust right-wing incumbent Nicolas Sarkozy.

Asian markets were subdued on Friday with Tokyo down 0.28 percent and Hong Kong and Sydney ending flat.

There is no comment

Please Sign up or Login to comment.

Top page