Investing.com - European stocks extended gains on Thursday, led by a sharp rise in financial stocks as investors were awaiting the announcement of Spain's 2013 budget, while speculation of fresh stimulus measures by China continued to support market sentiment.
During European afternoon trade, the EURO STOXX 50 advanced 0.70%, France’s CAC 40 jumped 0.90%, while Germany’s DAX 30 climbed 0.52%.
Investors remained cautious as Spain’s government was due to unveil its draft budget statement for 2013, amid ongoing speculation over whether Madrid will seek a full-scale sovereign bailout, which would trigger the European Central Bank’s bond buying program.
Meanwhile, Italy saw borrowing costs ease at an auction of government bonds earlier, with the yield on 10-year bonds falling to 5.24% from 5.82% and the yield on five-year bonds falling to 4.09%, down from 4.73%.
Sentiment strengthened earlier amid reports the People’s Bank of China injected a record CNY365 billion, or USD58 billion, this week into the Chinese banking system, easing liquidity conditions ahead of the end of the current quarter and before the Golden Week holidays next week.
Financial stocks turned broadly higher, erasing earlier losses, as shares in Germany's Deutsche Bank advanced 1.21%, while French lenders BNP Paribas and Societe Generale climbed 1.39% and 2.14% respectively.
Separately, Credit Agricole surged 3.10% after its CEO said it may sell its Emporiki Greek unit.
On the downside, auto stocks posted sharp losses after Volkswagen said some competitors risk going out of business without financial assistance as the region’s auto market worsens. Shares in the German manufacturer tumbled 1.57% and rival Daimler lost 0.31%, while French groups Peugeot and Renault fell 0.03% and 1.21%.
In London, commodity-heavy FTSE 100 added 0.34%, supported by strong gains in mining and oil stocks, while final data showed that the U.K.'s economy contracted less-than-expected in the second quarter.
Mining giants Rio Tinto and BHP Billiton advanced 2.04% and 1%, extending earlier gains, while copper producers Xstrata and Kazakhmys rallied 1.74% and 1.16% respectively.
Oil major Anglo American also gained ground, with shares surging 2.14%, while BP climbed 0.71%.
Elsewhere, U.K. lenders turned broadly higher. Shares in the Royal Bank of Scotland rose 0.73% and HSBC Holdings jumped 1.37%, while while Lloyds Banking and Barclays rallied 1.44% and 1.79%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.49% rise, S&P 500 futures signaled a 0.54% gain, while the Nasdaq 100 futures indicated a 0.42% increase.
Also Thursday, Germany's Federal Statistics Office said the number of unemployed people rose by a seasonally adjusted 9,000 in September, compared to expectations for an increase of 10,000.
Germany’s unemployment rate held steady at 6.8% in September, in line with expectations.
Later in the day, the U.S. was to publish its weekly government report on initial jobless claims, as well as data on pending home sales and durable goods orders.
During European afternoon trade, the EURO STOXX 50 advanced 0.70%, France’s CAC 40 jumped 0.90%, while Germany’s DAX 30 climbed 0.52%.
Investors remained cautious as Spain’s government was due to unveil its draft budget statement for 2013, amid ongoing speculation over whether Madrid will seek a full-scale sovereign bailout, which would trigger the European Central Bank’s bond buying program.
Meanwhile, Italy saw borrowing costs ease at an auction of government bonds earlier, with the yield on 10-year bonds falling to 5.24% from 5.82% and the yield on five-year bonds falling to 4.09%, down from 4.73%.
Sentiment strengthened earlier amid reports the People’s Bank of China injected a record CNY365 billion, or USD58 billion, this week into the Chinese banking system, easing liquidity conditions ahead of the end of the current quarter and before the Golden Week holidays next week.
Financial stocks turned broadly higher, erasing earlier losses, as shares in Germany's Deutsche Bank advanced 1.21%, while French lenders BNP Paribas and Societe Generale climbed 1.39% and 2.14% respectively.
Separately, Credit Agricole surged 3.10% after its CEO said it may sell its Emporiki Greek unit.
On the downside, auto stocks posted sharp losses after Volkswagen said some competitors risk going out of business without financial assistance as the region’s auto market worsens. Shares in the German manufacturer tumbled 1.57% and rival Daimler lost 0.31%, while French groups Peugeot and Renault fell 0.03% and 1.21%.
In London, commodity-heavy FTSE 100 added 0.34%, supported by strong gains in mining and oil stocks, while final data showed that the U.K.'s economy contracted less-than-expected in the second quarter.
Mining giants Rio Tinto and BHP Billiton advanced 2.04% and 1%, extending earlier gains, while copper producers Xstrata and Kazakhmys rallied 1.74% and 1.16% respectively.
Oil major Anglo American also gained ground, with shares surging 2.14%, while BP climbed 0.71%.
Elsewhere, U.K. lenders turned broadly higher. Shares in the Royal Bank of Scotland rose 0.73% and HSBC Holdings jumped 1.37%, while while Lloyds Banking and Barclays rallied 1.44% and 1.79%.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to a 0.49% rise, S&P 500 futures signaled a 0.54% gain, while the Nasdaq 100 futures indicated a 0.42% increase.
Also Thursday, Germany's Federal Statistics Office said the number of unemployed people rose by a seasonally adjusted 9,000 in September, compared to expectations for an increase of 10,000.
Germany’s unemployment rate held steady at 6.8% in September, in line with expectations.
Later in the day, the U.S. was to publish its weekly government report on initial jobless claims, as well as data on pending home sales and durable goods orders.