Find out more at btsub.sg/btdeal
You are here
European stocks bounce back
[LONDON] European stock markets bounced back on Monday as positive eurozone data and expectations of low US interest rates for some time helped offset renewed concerns over a weak Japanese economy.
London's benchmark FTSE 100 index and Frankfurt's DAX 30 each ended the day with a gain on 0.3 per cent, while the Paris CAC 40 added 0.5 per cent.
The euro slid to $1.1379.
"After a slow start European markets have regained some of their equilibrium today, as oil prices stabilised after rebounding off a four week low," said analyst Michael Hewson at CMC Markets UK.
"The decline in oil prices over the last few days appears to have been largely shrugged off by equity markets, probably due to the fact that the recent push higher in the US dollar appears to have run its course, against pared back expectations of future US rate rises," he added.
Eurozone stocks had slumped Friday on the first day of the second quarter as falling oil prices and renewed economic concerns in Japan hurt sentiment.
But they fought back on Monday as official data showed that unemployment across the single currency bloc fell to 10.3 per cent in February, a four-and-a-half year low point.
"While dark clouds packed over the eurozone economy in the beginning of the year, the labour market has continued to provide tailwind," ING bank senior economist Bert Colijn said in a note to clients.
"The improvements in unemployment continue to fuel domestic demand in times when consumers have become more cautious. This will likely mitigate the negative effects of people more concerned about the state of the global economy." On the European corporate front Monday, stocks in French telecoms companies fell sharply after market leader Orange said talks to purchase the rival network owned by industrial group Bouygues had failed.
Shares in Orange slumped 6.2 per cent and Bouygues plunged 13.5 per cent.
On Wall Street, the major indices were modestly lower in midday trading on Monday despite Virgin America shares surging more than 40 per cent on news it agreed to be acquired by Alaska Airlines in a $4 billion deal, including debt.
In Asia meanwhile, Japanese stocks fell for a fifth straight session as the yen strengthened against the dollar.
Most other Asian markets turned positive after a better-than-expected US jobs report and data showing US manufacturing activity increased in March for the first time in six months.
The news was the latest to highlight renewed strength in the world's top economy, but analysts said the Federal Reserve would still not raise interest rates before June at least.
"Friday's US labour market report was something of a middling result for markets," Philip Borkin, a senior economist at ANZ Bank New Zealand.
"On the one hand it was not really strong enough to suggest inflation pressures are going to run away on the Fed, but on the other, it certainly still showed, together with a rebound in (manufacturing data), that the economy is still performing well overall."