Sun, Jul 31, 2016 - Page 14 News List

EU markets stable in spite of weak growth in US, EU

AFP, NEW YORK

European stocks proved resilient on Friday, despite disappointing second-quarter economic growth in Europe and the US and an underwhelming stimulus package from the Bank of Japan.

Official US data estimated growth in the second quarter at an annual rate of 1.2 percent, far below the 2.6 percent expected by analysts.

The report showed weak investment by private businesses, offset somewhat by solid household consumption.

For the 19-nation eurozone, the EU reported growth slowed sharply to a tepid 0.3 percent pace in the second quarter.

Some analysts warned the surprise British vote to leave the EU last month could further crimp growth in the second half of the year.

Still, Frankfurt and Paris both ended the day higher.

In Frankfurt, the DAX closed up 0.6 percent at 10,337.50, while in Paris, the CAC 40 closed up 0.4 percent at 4,439.81.

London edged out a small gain as oil prices bounced off three-month lows struck earlier in the day, with the FTSE 100 closing up 0.1 percent at 6,724.43.

The Euro STOXX 50 closed up 0.8 percent at 2,990.76.

Italy’s Banca Monte dei Paschi di Siena SpA (BMPS) came a distant last in EU bank stress test results released late on Friday that showed the sector as a whole was broadly resilient.

The announcement came shortly after BMPS’ board announced a rescue plan for shifting the billions of euros in bad loans that have weighed on the embattled lender.

Some analysts fear that the bank’s bad debts may trigger a banking crisis in Italy and eurozone turmoil.

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