Date: Friday 29 Jun 2012
- Stocks surge following EU summit
- Euro nations end seniority for publically held debt
- €120bn growth plan
FTSE 100: +1.68%
Dax 30: +4.05%
Stoxx 600: +1.28%
Cac 40: +4.52%
Ibex 35: +5.34%
FTSE MIB: +6.42%
European stocks surged on Friday following an EU summit in Brussels which produced a raft of measures aimed at combating the sovereign debt crisis.
Amongst the measures agreed by the 17 countries which use the euro was a commitment to allow bailout funds to be directly injected into Spanish banks, whose loans into the property sector have been a major cause of the current crisis.
The politicians also agreed to end the preferred status of public sector lenders over the private sector. This ought to make banks more willing to lend to under-pressure nations because they know they will not be last in the queue should Spain or Italy go bust.
Other measures now firmly on the table include handing more bailout money to Spain and Italy, with very few strings attached, and a €120bn growth plan.
Unsurprisingly banks have been big beneficiaries of the Brussels summit, across France, Germany, Spain and Italy banks have been amongst the leading risers, Societe Generale (+9.6%), Commerzbank (+6%), Unicredit (+14.3%) and BBVA (+9%) all put in notable performances.
The owners of the Mercedes brand, Daimler, also had a good day, rising over 4% after revealing a tie up with Japanese firm Nissan.
On the Stoxx Europe 600 index the strongest sector was construction and materials (+4.92%). Health care was the weakest posting gains of just 0.9%
By 17:01 the euro had gained 1.79% against the dollar to stand at $1.2666.
At 16:42 front month futures contracts on a barrel of Brent crude had risen 4.47% to stand at $95.44.
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