Investing.com - European stocks posted strong gains in Friday trade, with financial issues leading the way, buoyed by hopes of a settlement between Europe’s leaders for a comprehensive plan to tackle the region’s debt threat.
At the end of Friday’s European session, the STOXX 50 Index climbed 2.89% to 2,337.51, France’s CAC 40 added 2.83% to 3,171.34, Britain’s FTSE 100 rose 1.93% to 5,488.65, and Germany’s DAX advanced 3.55% to close at 5,970.96.
Finance ministers from the euro-zone’s 17 nations convened in Brussels Friday to discuss boosting the current USD607 billion European Financial Stability Facility, but a rift remained between Germany and France on how best to maximize the fund’s impact.
France has pushed for the use of additional money to come from the European Central Bank, while Germany argued that such a move would violate an EU treaty prohibiting the financing of governments.
“We will stick to the situation as it is in the treaty, that the central bank is not available for state financing,” German Finance Minister Wolfgang Schaeuble said before Friday’s meeting.
Last week officials from both countries set Sunday as a deadline for formulating a plan, but announced adding a second meeting next Wednesday to formally outline details of an agreement.
Meanwhile, European Commissioner for Economic and Financial Affairs, Olli Rehn, said Friday that Greece would be receiving its next tranche of aid in November, provided that the Greek Parliament passes a savings and reform package as promised.
Elsewhere Friday, Germany’s Ifo Institute for Economic Research reported that its index of German business sentiment fell to 106.4 in October, down from 107.5 in September.
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Market expectations had been for a drop to 106.3 for the period.
“Given the international turmoil, the German economy is still performing well,” said Ifo President Hans-Werner Sinn following release of the data.
Financial issues across the region led session gainers, with Deutsche Bank AG surging 4.7%, Commerzbank AG strengthening by 5.3%, Societe Generale SA jumping 5.6% and Barclays Plc. rising by 5.8%.
Thomas Cook Group Plc skyrocketed by 13.1% after the travel firm agreed to terms with its financiers for a new USD158 million loan.
Supermarket operator Ocado Group Plc. rose 4.8% following an upgrade to the company’s stock from neutral to buy from Bank of America Merrill Lynch.
Meanwhile in mid-day trade on Wall Street the Dow Jones Industrial Average rose 1.51% to 11,715.60, the Nasdaq Composite Index advanced 0.77% to 2,618.50 and the S&P 500 was higher by 1.20% to 1,229.94.