Bulletin
Investor Alert

Europe Markets Archives | Email alerts

June 7, 2012, 12:14 p.m. EDT

Europe stocks up on China rate cut, Spain auction

Broad gains on the Continent; Swedish banks rally after holiday

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    STOXX Europe 600 Index (SXXP)
  • X
    Rio Tinto PLC (RIO)
  • X
    Rio Tinto PLC ADR (RIO)

or Cancel Already have a watchlist? Log In

By Sara Sjolin, MarketWatch

LONDON (MarketWatch) — European stock markets ended higher on Thursday, as investors cheered an interest-rate cut from China and a favorably received auction of Spanish government debt.

No hints of further easing from U.S. Federal Reserve Chairman Ben Bernanke took stocks off session highs.

The Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.29%  closed 1.1% higher at 242.64, extending gains into a third straight trading day.

Click to Play

Have the Fed's efforts helped?

It's been over 3 years since the Federal Reserve launched its first round of quantitative easing to try to boost U.S. growth. What did all these extraordinary, unconventional measures do for the economy? (Photo: Reuters)

Equities in Europe spiked in midday trade, after the People’s Bank of China unexpectedly cut two benchmark interest rates, both by 25 basis points. China rate cut

“This could give a much needed boost to trade in Europe and the rest of Asia as China’s domestic demand increases and as Chinese companies can now finance global operations at cheaper costs,” said Jordan Lambert, trader at Spreadex, in a note. “It is also worth being mindful that sometimes such interest-rate moves are coordinated with other central banks; therefore, there could be further surprises to the upside.”

The surprise move boosted resource firms and lifted U.K. miners out of negative territory. Rio Tinto PLC /zigman2/quotes/208934945/delayed UK:RIO -1.07%   /zigman2/quotes/202627887/composite RIO -2.42%  added 4%, BHP Billiton PLC   /zigman2/quotes/208108397/composite BHP -1.67%  rose 2.5% and Vedanta Resources PLC  gained 2.3%.

Shares of Burberry Group PLC /zigman2/quotes/205386705/delayed UK:BRBY +0.34%   /zigman2/quotes/203108786/delayed BURBY -0.75%  jumped 5.1%. Credit Suisse upgraded Burberry to outperform from neutral, saying the brand looks healthier than ever.

The U.K.’s FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX +0.09%  rose 1.2% to 5,447.79, further supported by Barclays PLC /zigman2/quotes/208409333/delayed UK:BARC -1.17%   /zigman2/quotes/206581728/composite BCS 0.00% , up 2.7%, while Lloyds Banking Group PLC /zigman2/quotes/202285510/delayed UK:LLOY -1.33% /zigman2/quotes/200709414/composite LYG 0.00%  added 3.5%.

Earlier, the Bank of England kept its key lending rate unchanged at a record low 0.5% and held the central bank’s asset-purchase program at 325 billion pounds ($506 billion). Bank of England maintains holding pattern

Success auction in Spain keeps IBEX up

Elsewhere, Spanish stocks rose as the government sold a total of 2.07 billion euros ($2.6 billion) of debt, passing a key test of market sentiment amid concerns about the country’s economy. Spanish bond auction

Spain’s Treasury had aimed to sell a total of €1 billion to €2 billion. The yield on 10-year government bonds produced an average yield of 6.04%, up from 5.74% in a previous sale, Bloomberg reported.

In the secondary market, yields on benchmark 10-year government bonds declined 22 basis points to 6.04%, according to FactSet. A basis point is 1/100th of a percentage point.

The IBEX 35 index /zigman2/quotes/210597995/delayed XX:IBEX -0.11%  inched 0.3% higher to 6,438.10, well below its intraday high of 6,537.80. Spanish shares trimmed gains as Bernanke testified to Congress and left out signals of further easing stimulus, said Predrag Dukic, senior equity sales trader at CM Capital Markets in Madrid.

“Markets move once Bernanke starts talking and when he doesn’t mention QE3 (quantitative easing) or liquidity injections the markets get disappointed,” he said.

/zigman2/quotes/210599654/delayed
XX : STOXX
363.55
+1.06 +0.29%
Volume: 0.00
Aug. 7, 2020 11:03p
loading...
/zigman2/quotes/208934945/delayed
UK : U.K.: London
4,669.50 p
-50.50 -1.07%
Volume: 1.92M
Aug. 7, 2020 4:35p
P/E Ratio
13.34
Dividend Yield
6.36%
Market Cap
£79.04 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/202627887/composite
US : U.S.: NYSE
$ 60.95
-1.51 -2.42%
Volume: 2.05M
Aug. 7, 2020 4:00p
P/E Ratio
13.79
Dividend Yield
6.33%
Market Cap
$103.15 billion
Rev. per Employee
$852,406
loading...
/zigman2/quotes/208108397/composite
US : U.S.: NYSE
$ 55.89
-0.95 -1.67%
Volume: 2.31M
Aug. 7, 2020 4:00p
P/E Ratio
15.03
Dividend Yield
5.12%
Market Cap
$131.69 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/205386705/delayed
UK : U.K.: London
1,320.00 p
+4.50 +0.34%
Volume: 1.05M
Aug. 7, 2020 4:35p
P/E Ratio
44.97
Dividend Yield
0.86%
Market Cap
£5.33 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/203108786/delayed
US : U.S.: OTC
$ 17.10
-0.13 -0.75%
Volume: 4.33M
Aug. 7, 2020 3:49p
P/E Ratio
46.53
Dividend Yield
2.92%
Market Cap
$6.95 billion
Rev. per Employee
$347,421
loading...
/zigman2/quotes/210598409/delayed
UK : FTSE UK
6,032.18
+5.24 +0.09%
Volume: 0.00
Aug. 7, 2020 4:59p
loading...
/zigman2/quotes/208409333/delayed
UK : U.K.: London
104.60 p
-1.24 -1.17%
Volume: 31.73M
Aug. 7, 2020 4:35p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
£18.13 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/206581728/composite
US : U.S.: NYSE
$ 5.54
0.00 0.00%
Volume: 2.97M
Aug. 7, 2020 4:00p
P/E Ratio
N/A
Dividend Yield
2.60%
Market Cap
$23.66 billion
Rev. per Employee
$458,292
loading...
/zigman2/quotes/202285510/delayed
UK : U.K.: London
27.79 p
-0.38 -1.33%
Volume: 100.76M
Aug. 7, 2020 4:35p
P/E Ratio
67.77
Dividend Yield
0.00%
Market Cap
£19.66 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/200709414/composite
US : U.S.: NYSE
$ 1.42
0.00 0.00%
Volume: 4.04M
Aug. 7, 2020 4:00p
P/E Ratio
69.61
Dividend Yield
3.92%
Market Cap
$25.66 billion
Rev. per Employee
$438,332
loading...
/zigman2/quotes/210597995/delayed
XX : Spain: Madrid
6,950.50
-7.40 -0.11%
Volume: 184.15M
Aug. 7, 2020 5:38p
loading...
1 2
This Story has 0 Comments
Be the first to comment
More News In
Markets

Story Conversation

Commenting FAQs »

Partner Center

World News from MarketWatch

Link to MarketWatch's Slice.