Sun, May 12, 2013 - Page 15 News List

EU markets post gains as earnings, data beat estimates


European stocks rallied for a third week, closing at their highest level in almost five years, as companies from BT Group PLC to Hochtief AG posted earnings that beat estimates, while economic data exceeded expectations.

BT surged 13 percent as the fixed-line phone operator proposed a higher full-year dividend, while Hochtief gained 7.5 percent after it posted a first-quarter profit and sold its airport division. Alcatel-Lucent SA rose 14 percent as its chief executive officer said that he may sell assets abd National Bank of Greece SA led stocks in Greece, surging 48 percent.

The STOXX Europe 600 Index rose 1.3 percent this week to 304.99, its highest level since June 2008. The equity benchmark has gained 9.1 percent so far this year amid confidence that central banks around the world will continue to add stimulus to support economic growth.

“The stock rally is mainly driven by continued accommodative policies around the world, lately the rate cut by the European Central Bank and the aggressive money printing in Japan,” RobecoSAM AG portfolio manager Kai Fachinger wrote in a message.

The Bank of England’s Monetary Policy Committee left its bond-purchase program at £375 billion (US$575 billion) when it met on Thursday. The policymakers also held their benchmark interest rate at 0.5 percent. In Asia, Bank of Korea Governor Kim Choong-soo and his board lowered their benchmark seven-day repurchase rate on Thursday to 2.5 percent from 2.75 percent.

Reports from two of Europe’s three biggest economies beat estimates. In Germany, a measure of industrial production increased 1.2 percent in March. Economists surveyed by Bloomberg had predicted a 0.1 percent drop.

A separate release showed that Germany’s exports, adjusted for working days and seasonal changes, advanced 0.5 percent in March. They declined 1.2 percent in February.

UK industrial production also rose more than economists had forecast as cold weather increased demand for electricity and gas. Output climbed 0.7 percent from February, a report from the British Office for National Statistics showed on Thursday.

National benchmark indices advanced in every western European market this week, except for Spain. The UK’s FTSE 100 added 1.6 percent, France’s CAC 40 rose 1 percent and Germany’s DAX jumped 1.9 percent.

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