Date: Monday 02 Jul 2012
- Stocks up as investors eye ECB rates decision
- Asian data surprises on the upside
Dax 30: +1.24%
Stoxx 600: +1.45%
Cac 40: +1.36%
Ibex 35: +0.31%
FTSE MIB: +0.24%
Expectations of lower interest rates in the euro area and continuing optimism following the EU summit last week pushed stocks up on Monday.
Both the European Central Bank and the Bank of England will announce their key interest rate decisions on Thursday with the betting that the ECB will reduce interest rates to a record 0.75%.
In China, the government’s purchasing manager’s index dropped to 50.2 in June from 50.4 in May, this was still better than the consensus expectation of 49.9.
In Japan, the closely watched Tankan index, which measures sentiment in the manufacturing sector, came in at minus 1, meaning there were more pessimistic responses than optimistic ones. But the market had been expecting a worse negative reading.
One piece of bad news was the US Institute for Supply Management’s factory index falling to 49.7, from 53.5 in June. Expectations had been for a reading of 52.
A strong day for banking shares. Credit Agricole was the biggest riser in Paris following reports it may divest its trading and research division.
BNP Paribas was the second biggest riser after Credit Agricole’s research division wrote a positive note on the stock.
In Spain, BBVA rose a whopping 9% while in Frankfurt Commerzbank ended the day up 2.5%.
On the Stoxx Europe 600, the strongest sector was oil and gas, up 1.98%. The weakest was chemicals which gained 0.44%.
Front month futures contracts on a barrel of Brent Crude dropped 1.8% to $96.
The euro was down 0.66% against the dollar by 17:00 in London at $1.2583.
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