Paris paces post-Christmas gains; Adidas sees record year for sales
By Sara Sjolin, MarketWatch
COPENHAGEN (MarketWatch) — European stock markets rose on Thursday as hopes for stimulus in Japan spurred some optimism, with investors focused on Washington and the U.S. fiscal cliff as well.
The Stoxx Europe 600 index XX:SXXP +0.22% added 0.3% to 281.24, following a two-day closure in observance of Christmas.
Atif Latif, director of trading at Guardian Stockbrokers, said the gains represented the European market “playing catch-up.”
He added: “There are a few things that will determine how much more the market will look to rally into the year-end, namely the fiscal cliff developments, sovereign downgrade risks in Europe and the expectations that growth in the U.K. and euro zone is starting to improve.”
Shares of Clariant AG CH:CLN +3.13% scored one of the biggest gains in the pan-European index, jumping 3.1%. The company said it will sell its textile-chemicals, paper specialties and emulsions business to SK Capital for about 502 million Swiss francs ($550 million). See: SK Capital to buy Clariant textile, paper units
Mining shares also stood out among the gainers, keying off overnight gains for Asian peers. London-listed Rio Tinto PLC UK:RIO +1.50% RIO +0.67% AU:RIO +0.94% rose 1.7%, while BHP Billiton PLC UK:BLT +1.54% BHP +0.31% AU:BHP +0.35% climbed 1.5%.
Atif Latif, director of trading at Guardian Stockbrokers, said the gains represented the European market “playing catch-up.”
He added: “There are a few things that will determine how much more the market will look to rally into the year-end, namely the fiscal cliff developments, sovereign downgrade risks in Europe and the expectations that growth in the U.K. and euro zone is starting to improve.”
Shares of Clariant AG CH:CLN +3.13% scored one of the biggest gains in the pan-European index, jumping 3.1%. The company said it will sell its textile-chemicals, paper specialties and emulsions business to SK Capital for about 502 million Swiss francs ($550 million). See: SK Capital to buy Clariant textile, paper units
Mining shares also stood out among the gainers, keying off overnight gains for Asian peers. London-listed Rio Tinto PLC UK:RIO +1.50% RIO +0.67% AU:RIO +0.94% rose 1.7%, while BHP Billiton PLC UK:BLT +1.54% BHP +0.31% AU:BHP +0.35% climbed 1.5%.
The U.K.’s FTSE 100 index UK:UKX +0.25% rose 0.3% to 5,974.51.
Broadly, stock markets were further supported by speculation that Japan will take further stimulus measures to boost the nation’s economy.
Finance Minister Taro Aso said the country’s newly-elected government won’t abide by a ceiling on bond issuances when it decides on the size of an upcoming supplementary budget, aimed at stimulating to the ailing economy, according to media reports. See: Japan won't abide by bond cap for stimulus:reports
Japanese stocks rallied overnight to the highest level since the March 2011 earthquake. See: Japan stocks hit post-earthquake high, lead Asia.
Financial markets also tracked developments on Capitol Hill, looking for progress on settling differences on a budget deal before a raft of tax hikes and spending cuts takes effect. President Barack Obama was expected to return to Washington imminently to resume negotiations.
“The fiscal cliff deadline is now less than a week away and we think that the recent meeting with Obama has been credible. The onus is now on the ability to agree on tax hikes and spending cuts,” Latif from Guardian Stockbrokers said.
On the U.S. data front, initial jobless claims dropped by 12,000 last week to 350,000, although the decline may have been exaggerated by the Christmas holiday. Economists surveyed by MarketWatch had forecast claims of 360,000, off from a revised 362,000 in the prior week. See: U.S. jobless claims fall 12,000 to 350,000
Closer to home, shares of France’s Total SA FR:FP +1.35% TOT +1.39% rose 1.6%, tracking Wednesday rally for crude-oil prices.
The French CAC 40 index FR:PX1 +0.73% gained 0.8% to 3,683.08.
And in Germany, the DAX 30 index DX:DAX +0.44% picked up 0.5% to 7,672.31, with shares of Deutsche Bank AG DE:DBK +1.64% DB +1.52% trading 2% higher and Commerzbank AG DE:CBK +0.97% adding 1.5%.
Shares of Adidas AG DE:ADS -0.22% nudged 0.2% lower. In an interview with Sueddeutsche Zeitung, Chief Executive Herbert Hainer said the sports-apparel maker will post record sales in 2012.
Outside the major indexes, shares of Assa Abloy AB SE:ASSAB +1.79% added 1.6%, as the lock firm said it has acquired 4Front, a U.S. company with expertise in docking systems.
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.
