Europe close: Shares end session moderately higher despite gains for currency

Alexander Bueso WebFG News | 19 May, 2017 19:02 | | |

screenshot 12 01 2017 13 05 37

Stocks ended the session with moderately strong gains despite another move higher for the single currency aided by dovish Fedspeak.

Against that backdrop, Greece was in the spotlight at the end of the week even as the angst around the political situation in the US over the past few days appeared to have calmed down, at least for the moment.

At the closing bell, the benchmark Stoxx 600 was up by 0.60% to 391.51, alongside gains of 0.39% for Germany's Dax which was at 12,638.69 and a rise of 1.26% for the FTSE Mibtel to 21,567.52.

"Equity indices are holding their rebound gains, albeit treading water since the European open, as investors weigh up recent market moves. Whilst not electing to take on more risk before the weekend, nor are they taking any more off the table. A positive statement in many ways, given the political headwinds in play," said Mike van Dulken, Head of Research at Accendo Markets.

In parallel, euro/dollar was wanted, rising 0.98% to 1.1212, with front month Brent crude oil futures gaining 1.80% to $53.47 per barrel on the ICE.

The former was given by a boost by remarks from St.Louis Fed chair James Bullard, who told an audience that calls for two more interest rate hikes in the States this year might be "too aggressive".

Overnight, the parliament in Athens approved the pension and tax cuts asked for by creditors before they released the next tranche of bailout aid and, perhaps, provided the country with debt relief.

However, while Greece's lenders had agreed to debt relief in principle, few details had been provided thus far.

Ahead of a meeting of Eurozone finance ministers on 22 May, Greek prime Minister Alexis Tsipras said: "We deserve and we expect from Monday's Eurogroup a decision regulating debt relief which will correspond to the sacrifices of the Greek people."

In parallel, investor sentiment around recent events on Capitol Hill appeared to have stabilised for the moment.

Craig Erlam, senior market analyst at Oanda, said: "Wednesday’s sell-off may have shocked a few people but US indices remain in the same range they’ve traded in for the last few months and as long as that remains the case, it would suggest that investors are not too concerned."

The euro area recorded a current account surplus of €34.1bn in March, according to the European Central Bank.

Factory gate prices in the Eurozone's largest economy advanced by 0.4% month-on-month in April with the annual rate of gains rising from 3.1% to 3.4% (consensus: 3.2%), according to the Federal Office of Statistics.

The European Commission's 'flash' consumer confidence index for the month of May improved by 0.3 points to -3.3 (consensus: -3.1).

Spain's Banco Popular shot higher after El Confidencial reported that Santander had hired Citi to prepare a binding offer for the stricken lender.

From a sector standpoint, the biggest gains on the Stoxx 600 were being seen in Automobile (0.70%) and Basic Resource stocks (0.47%).

To take note of, Barclays reiterated an 'underweight' view on Saint-Gobain and an 'overweight' stance on SAP.

At the individual level, shares in Dufry AG shot higher on news that Richemont had acquired a 5% stake in the travel retailer.

Eutelsat reached a deal with Abertis to sell its 33.69% stake in Hispasat for €302m.

More news

22:51 US close: Markets lower, Dow breaks winning streak

Wall Street’s main indices gave up earlier gains to close lower on Thursday, as healthcare, materials and telecoms stocks dragged investor sentiment down late in the session.

21:54 Friday preview: EU council summit conclusion, SThree and Trinity Mirror updates

The conclusion of the EU Council summit will be the main focus for markets on Friday, with no FTSE 350 companies expected to report results.

21:23 Walt Disney to buy 21st Century Fox assets in $52.4bn deal, including Sky stake

Walt Disney has announced an agreement to buy the entertainment assets of 21st Century Fox in a deal worth around $52.4bn, including a 39% stake in UK broadcaster Sky.

21:20 Scotland introduces income tax raise for top earners

The Scottish government has announced it will increase the tax paid by the country’s highest earners, as it bids to raise extra money to fund wage increases in the public sector.

20:37 Europe close: Stocks slip as traders mull ECB's next move

Stocks finished lower, tracking a weak start to trading on Wall Street and on the back of a mixed batch of economic data out of China overnight and a tweak in monetary policy by the People's Bank of China - a timely reminder perhaps of the potential ripple effects of US policy decisions and vice-versa.

18:01 London close: Footsie lower as traders test Sterling upside

London stocks finished lower on Thursday as the Bank of England stood pat on monetary policy, as widely expected, but amid dovishness across the Pond and on the other side of the Channel which resulted in a stronger Sterling.

13:18 BoE expects gradual and limited policy tightening over medium-term

The Bank of England kept policy on hold by a unanimous vote as had been widely-anticipated given previous guidance for a very gradual pace of tightening over the medium-term.

13:13 China tweaks lending rates after Fed decision

China's central bank tweaked two of its policy rates in what some analysts said was a bid to relieve pressure on the country's currency.

13:04 Google trends reveal the most searched terms of 2017

Bitcoin, the increasingly popular cryptocurrency has dominated Google’s top searches this year.

13:16 ECB keeps all rates unchanged, confirms guidance on asset purchases

The European Central Bank has opted to keep all its main policy rates unchanged, with policy-makers reiterating that they expect to keep all their key rates as they are until well past the end of the ECB's net asset purchase programme.