European Market Rebound, Investors Expect Gains to Extend

Nigel Thomas
16 Jan, 2013
New York City

European markets recovered from early losses and institutional investors stepped up to add exposure to stocks. Investors expect another year of market gains across Europe in a survey conducted by the research team at 123jump.com.

[R]4:30 PM Frankfurt – European markets recovered from early losses and institutional investors stepped up to add exposure to stocks. Investors expect another year of market gains across Europe in a survey conducted by the research team at 123jump.[/R]

Market indexes across Europe recovered from early losses as investors stepped up to add more exposure to stocks.

General sentiment among institutional investors was positive. According to a latest survey conducted by the research team at 123jump.com of 120 fund managers in Frankfurt, London and Paris suggested optimistic outlook.

Investors in the survey suggested low volatility, supportive stance from the ECB and rising earnings from the industrial and technology companies to drive the market index higher in 2013.

For the year so far, FTSE 100 index is up 3.3%, and DAX index has gained 1% and CAC 40 index has jumped 1.9%.

FTSE 100 index closed down 13.3 or 0.2% to 6,104 and DAX index closed up 15.2 or 0.2% to 7,691. In Paris trading, CAC 40 index gained 11.1 or 0.3% to 3,708 after falling as much as 0.3% in the session.

The European Parliament approved tougher regulation on credit rating agencies and demanded more transparency from the agencies.

The approval will now go to member nations and the new rules will require agencies to set up a fixed publication calendar and will be limited to three reviews for unsolicited sovereign ratings and disclose more information about the underlying facts and decision process.

The rules for the first time can hold an agency liable in case it violates regulation intentionally or with gross negligence.

Stocks in Review

Mining companies were in decline after resource sector stocks closed lower in London and in Frankfurt.

AngloAmerican declined 3% to 1,901 pence after the ANC asked South African government to withdraw mining licenses for the company’s platinum plant.

AngloAmerican Platinum Ltd said that plans to idle four shafts in South Africa and cut production of platinum by 400,000 ounces a year and may lay off as many as 14,000 workers.

The third largest platinum producer, Lonmin Plc dropped 6% to 326.6 pence


Banks were in focus after JP Morgan and Goldman Sachs reported higher earnings. Societe General SA declined 3% to €32.45 and Deutsche Bank declined 1% to €48.68. HSBC Holdings Plc increased 0.4% to 682 pence and UniCredit SpA declined €1.35.

KappAhl soared 17% to SK5.10 after the second largest Swedish clothing retailer reported first quarter net profit of SK115 million.

TUI Travel increased 4% to 292.1 pence after the company said it is in early talks to merge with TUI AG which soared 9% to €8.05.