European Markets Rise on Japan, Portugal Comments; Greek CPI Soars

Arthi Gupta
11 Jan, 2011
New York City

The European indexes rose after Japan pledged buying euro-zone bonds. Portugal said it does not need bailout as the nation prepares to raise 1.25 billion euros tomorrow. French business sentiment improved in December. Greek CPI inflation soared in December.

[R]4:00 PM Frankfurt – The European indexes rose after Japan pledged buying euro-zone bonds. Portugal said it does not need bailout as the nation prepares to raise 1.25 billion euros tomorrow. French business sentiment improved in December. Greek CPI inflation soared in December.[/R]

Portugal is scheduled to raise 1.25 billion euros through the sale of 10-year bonds on Wednesday and has to raise 20 billion euros in the year. Investors fear that yields at 7% or more are not sustainable in the long term. Portugal is battling slow growth and high current account deficit.

Japan is planning to buy euro-zone sovereign bonds to help the single currency region deal with its debt crisis, the nation''s finance minister said on Tuesday.

Yoshihiko Noda said Japan will use its foreign exchange reserves to buy about 20% of bonds to be issued later this month under a special assistance program to help the Irish Republic.

Portugal will not ask for external aid and its 2010 budget deficit stayed below the target of 7.3% of gross domestic product, Prime Minister Jose Socrates reportedly said on Tuesday. The government aims to reduce its deficit to 4.6% this year.

Rumors that France and Germany are pressuring Lisbon to take a lifeline are only helping speculators, he said.

Portugal is doing everything to avoid the possibility of accepting a rescue from the European Union and the International Monetary Fund, Finance Minister Fernando Teixeira dos Santos told TSF radio on Tuesday.

""""We are doing our job,"""" he said. """"Clearly, Europe is not doing its job to guarantee the stability of the euro,"""" he added.

In Paris CAC 40 Index gained 42.60 or 1.12% to close at 3,844.63 and in Frankfurt DAX Index edged higher 57.14 or 0.83% to close at 6,914.20.

OECD Jobless Rate Static

The unemployment rate in the Organization for Economic Cooperation and Development area remained unchanged at 8.6% in November, the OECD said on Tuesday.

The unemployment rate for the United States fell 0.4 percentage point to 9.4% in December, while the rate for Canada was unchanged at 7.6%. Germany''s rate stayed at 6.7%.

Europe Monster Employment Index Remains Flat

The Monster Employment Index for Europe remained at 122 for the third consecutive month, the Monster Worldwide Inc. said on Tuesday. Online job demand increased by 22% annually in December, reflecting a more robust European economy and greater confidence in hiring.

French Business Sentiment Improves

French industrial and services confidence continued to increase in December, according to survey data released by the Bank of France today.

The industrial confidence index climbed to 108 in December from 107 recorded in November. The confidence indicator for French services sector increased to 99 in December from 98 in November.

Czech Retail Sales Fall

Czech''s retail sales, including sales and repair of motor vehicles decreased a seasonally adjusted 0.3% on a monthly basis in November, the Czech Statistics Office said today.

Annually, retail sales, including sales and repair of motor vehicles, grew 5% in December, reversing a 0.7% decline in November.

Estonia''s Trade Deficit Widens

Estonia''s trade deficit widened to €40 million in November from €10.4 million in October, latest data released by Statistics Estonia showed.

Exports of goods rose 48% annually to €860.4 million and imports increased 38% to €900.3 million.

Greek CPI Inflation Up

Greek consumer price annual inflation rose in December after easing in November, latest data from the Hellenic Statistics Authority showed.

The consumer price index climbed 5.2% annually in December following the 4.9% increase in November. On a monthly basis, consumer prices grew 0.4% in December, as against November''s 0.2% rise.

Gainers & Losers

ABB Ltd. fell 0.45% to $21.90 after the power and automation technologies provider announced that its unit Brock Acquisition Corp. extended the expiration date for its tender offer for all of the outstanding shares of Baldor Electric Co., until 5:00 p.m., New York City time, on Wednesday, January 19 extended from January 10.

Actelion Ltd. dropped 2.10% to Sfr51.30 after the Swiss biotechnology firm warned that its full year 2010 non-GAAP earnings before tax or EBIT would come in below its guidance range.

Air France-KLM decreased 1.34% to €19.10 after the global airlines company said Saudi Arabia''s state-owned Saudi Arabian Airlines signed an agreement to join the SkyTeam airline alliance in 2012.

Alstom S.A. surged 5.74% to €37.01 after the French engineering group said it agreed with Bouygues SA to create a 50/50 joint venture through its subsidiaries Bouygues Immobilier and ETDE.

BAE Systems Plc climbed 1.35% to 345.00 pence after the British defense, security and aerospace company said it sold Swiss-Photonics AG group to Forensic Technology WAI Inc. for a cash of $10.9 million.

Galapagos NV gained 0.84% to €12.06 after the Belgium-based biotechnology company said that it received a milestone payment of €7.4 million from its arthritis alliance with GlaxoSmithKline.

Metro AG edged lower 0.28% to €52.49 after the German retailer reported higher sales for its fourth quarter, as strong international sales offset weather-hit domestic sales decline.

In the fourth quarter, total sales grew 1.6% to €19.7 billion from last year''s €19.4 billion. The sales edged up 0.1% in local currency.

Qiagen NV rose 1.01% to €14.95 after the biotech pioneer announced the signing of an agreement for the acquisition of a strategic stake in Alacris Theranostics GmbH, a German start-up company using novel technologies to develop individualized cancer treatment strategies based upon a patient''s genomic profile, and for the purchase of an exclusive option to access all biomarkers emerging from this discovery program.

Siemens AG dropped 0.50% to $115.68 after the company engaged in electronics and electrical engineering said it is on track to reach its full-year targets as """"strong momentum"""" at its short-cycle industrial unit will continue into the first-half.