Investing.com - European stock markets remained sharply higher on Wednesday, as investors eyed the European Central Bank’s policy meeting later in the day, with hopes it will lead to further stimulus measures.
During European afternoon trade, the EURO STOXX 50 surged 2.14%, France’s CAC 40 jumped 2.06%, while Germany’s DAX 30 rallied 1.72%.
Market sentiment found support amid speculation by market players that the ECB could announce liquidity injections in to Europe's troubled financial system. Other analysts expect the central bank to renew its suspended government bond-buying program to help ease pressure on Spain’s rising borrowing costs.
In addition, Federal Reserve Chairman Ben Bernanke was due to testify on Thursday before a congressional committee about the strength of the U.S. economy. The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the U.S. central bank is mulling new measures to stimulate growth in the world’s largest economy.
Financial stocks extended earlier gains, as shares in French lenders Societe Generale and BNP Paribas surged 2.97% and 3.36% respectively, while Germany’s Deutsche Bank and Commerzbank climbed 2.12% and 1.52%.
Commerzbank was one of the six German lenders downgraded on Tuesday evening by Moody’s ratings agency, which also cut the ratings of Austria’s three largest banks, saying they face risks if the euro zone crisis deepens.
Meanwhile, telecom giant Nokia Finland saw shares surge 6.54%, after U.S. Internet company Google lodged a complaint with European Union competition authorities against Nokia and its U.S. software peer Microsoft. The complaint alleges collusion between Nokia and Microsoft in order to increase prices for smartphones and tablets.
In London, FTSE 100 gained 1.40%, boosted by strong gains in financial stocks while data showed that construction activity in the U.K. fell more-than-expected in May.
Shares in the Royal Bank of Scotland were up 7.88% after skyrocketing 932.52% when markets opened, as a result of a share consolidation authorized at the bank's annual meeting last week. According to Sir Philip Hampton, chairman of the bank, the consolidation will reduce the "volatility" of the bank's share price and help improve investor confidence.
Lloyds Banking saw shares climb 5.33% after agreeing to sell GBP809 million of Australian corporate real estate loans to a Morgan Stanley and Blackstone Group LP joint venture for about GBP388 million pounds in cash. Meanwhile, Barclays and HSBC Holdings rose 5.94% and 3.27% respectively.
Energy stocks also contributed to gains, as Premier Oil Plc jumped 6.84% after the British explorer said it encountered oil in its 50% owned Carnaby 28/09-5A well in the North Sea. Cairn Energy, which owns 15% of the Carnaby well, rose 4.78%.
Mining stocks extended earlier gains, as Rio Tinto and Bhp Billiton added 3.57% and 3.44% respectively, while copper producers Xstrata and Kazakhmys jumped 3.06% and 6.24%.
Elsewhere, Diageo Plc, the maker of Johnnie Walker, J&B and Buchanan’s scotch whiskeys, advanced 2.31% after saying it will invest in scotch whiskey production.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to jump of 0.92%, S&P 500 futures signaled a 1.10% rally, while the Nasdaq 100 futures indicated a 1.13% surge.
Also Wednesday, official data showed that German industrial production dropped 2.2% in April, compared to expectations for a more modest 1.0% decline, fuelling concerns over the impact of the ongoing sovereign debt crisis on the region’s largest economy.
Later in the day, the ECB rate announcement was to be followed by a press conference with bank head Mario Draghi to discuss the monetary policy decision and the economic outlook for the region.
During European afternoon trade, the EURO STOXX 50 surged 2.14%, France’s CAC 40 jumped 2.06%, while Germany’s DAX 30 rallied 1.72%.
Market sentiment found support amid speculation by market players that the ECB could announce liquidity injections in to Europe's troubled financial system. Other analysts expect the central bank to renew its suspended government bond-buying program to help ease pressure on Spain’s rising borrowing costs.
In addition, Federal Reserve Chairman Ben Bernanke was due to testify on Thursday before a congressional committee about the strength of the U.S. economy. The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the U.S. central bank is mulling new measures to stimulate growth in the world’s largest economy.
Financial stocks extended earlier gains, as shares in French lenders Societe Generale and BNP Paribas surged 2.97% and 3.36% respectively, while Germany’s Deutsche Bank and Commerzbank climbed 2.12% and 1.52%.
Commerzbank was one of the six German lenders downgraded on Tuesday evening by Moody’s ratings agency, which also cut the ratings of Austria’s three largest banks, saying they face risks if the euro zone crisis deepens.
Meanwhile, telecom giant Nokia Finland saw shares surge 6.54%, after U.S. Internet company Google lodged a complaint with European Union competition authorities against Nokia and its U.S. software peer Microsoft. The complaint alleges collusion between Nokia and Microsoft in order to increase prices for smartphones and tablets.
In London, FTSE 100 gained 1.40%, boosted by strong gains in financial stocks while data showed that construction activity in the U.K. fell more-than-expected in May.
Shares in the Royal Bank of Scotland were up 7.88% after skyrocketing 932.52% when markets opened, as a result of a share consolidation authorized at the bank's annual meeting last week. According to Sir Philip Hampton, chairman of the bank, the consolidation will reduce the "volatility" of the bank's share price and help improve investor confidence.
Lloyds Banking saw shares climb 5.33% after agreeing to sell GBP809 million of Australian corporate real estate loans to a Morgan Stanley and Blackstone Group LP joint venture for about GBP388 million pounds in cash. Meanwhile, Barclays and HSBC Holdings rose 5.94% and 3.27% respectively.
Energy stocks also contributed to gains, as Premier Oil Plc jumped 6.84% after the British explorer said it encountered oil in its 50% owned Carnaby 28/09-5A well in the North Sea. Cairn Energy, which owns 15% of the Carnaby well, rose 4.78%.
Mining stocks extended earlier gains, as Rio Tinto and Bhp Billiton added 3.57% and 3.44% respectively, while copper producers Xstrata and Kazakhmys jumped 3.06% and 6.24%.
Elsewhere, Diageo Plc, the maker of Johnnie Walker, J&B and Buchanan’s scotch whiskeys, advanced 2.31% after saying it will invest in scotch whiskey production.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures pointed to jump of 0.92%, S&P 500 futures signaled a 1.10% rally, while the Nasdaq 100 futures indicated a 1.13% surge.
Also Wednesday, official data showed that German industrial production dropped 2.2% in April, compared to expectations for a more modest 1.0% decline, fuelling concerns over the impact of the ongoing sovereign debt crisis on the region’s largest economy.
Later in the day, the ECB rate announcement was to be followed by a press conference with bank head Mario Draghi to discuss the monetary policy decision and the economic outlook for the region.