Sponsored by: Investment Center

Something new in your business?  Click here to submit your business press release

Chamber Corner | Main Street News | Job Hunt | Classifieds | Calendar | Illinois Lottery 

European stocks up cautiously on hopes for Greece

Send a link to a friend

[February 09, 2010]  LONDON (AP) -- European stocks rose cautiously Tuesday on hopes that EU officials will provide Greece with some form of support to handle its mountain of debt and keep the market crisis from spreading to other vulnerable countries.

HardwareAlthough the European Investment Bank said Tuesday it would not be able, according to its own rules, to offer Greece or any other country a bailout, investors are betting that a meeting on Thursday of EU heads of state will address the market's worry about sovereign debt.

Britain's FTSE 100 index was up 0.5 percent at 5,116.17 and Germany's DAX gained 0.3 percent to 5,499.81. France's CAC-40 rose 0.1 percent to 3,610.95.

Asian indexes were mixed at the close, drawn between losses on Wall Street overnight and the improvement in confidence in Europe. In the U.S., a rise was expected on the open, with Dow Jones industrials futures up 56 points at 9,951.00 and Standard & Poor's 500 futures rising 7.8 points to 1,063.70.

"This meeting of EU leaders is set to discuss the economic roadmap of the eurozone for the next 10 years; however it is difficult to see how the problems of Greece and other vulnerable indebted nations won't overshadow the summit," said Michael Hewson, analyst at CMC Markets.

Greece's government is currently discussing wage and pension reform in an effort to gain credibility in its plan to drive down its debt load. However, nationwide strikes were planned for Wednesday, possibly undercutting any confidence in the country's plan.

"It would appear that these countries still don't get it, and this starkly highlights the problems ahead for the politicians as they seek to find a resolution to a problem that threatens to undermine the entire concept of the single currency," Hewson said.

He said a bailout would be very problematic, since that would urge other heavily-indebted countries to seek the same treatment -- most governments piled on debt in the wake of the financial crisis.

Some experts believe the European Central Bank may come up with a form of support which would not require a bailout, such as guarantees for debt. It was reported that ECB President Jean-Claude Trichet left a seminar in Australia early in order to attend to EU leaders' summit -- "a move that has increased speculation that the EU maybe on the verge of providing some support for its high yielding economies," said Stuart Bennett, analyst at Calyon. High yields are a symptom of falling bond prices and increased perception of risk.

However, worries that confidence in Greece's debt will erode and spread to other countries with weak public finances -- such as Portugal or Spain -- has kept investors on edge, pushing global markets lower overnight.

[to top of second column]

Tokyo's Nikkei 225 stock average lost 0.2 percent to 9,932.90 while Sydney's S&P-ASX 200 declined 0.4 percent to 4,505.1 after the Dow closed below 10,000 for the first time in three months.

Chinese markets fared better, but trading has been listless as investors hunker down ahead of a weeklong closure of mainland exchanges for next week's Lunar New Year holiday. The benchmark Shanghai Composite Index gained 0.5 percent to 2,948.84 and Hong Kong's Hang Seng index advanced 1.2 percent to 19,790.28. Seoul's Kospi rose 1.1 percent to 1,570.49.

Elsewhere, benchmarks in Thailand, Malaysia and the Philippines fell. Markets in Singapore, Taiwan and India posted solid gains.

Asian stocks are so sensitive to the health of Western export markets that analysts say even regional developments as severe as Toyota Motor Corp.'s struggles with a spate of safety problems have little impact.

Library

The Dow fell 103.84, or 1 percent, to 9,908.39. On Thursday, the Dow traded below the symbolic barrier of 10,000 for the first time since November. It hadn't closed below that mark since Nov. 4.

Oil prices rose above $72 a barrel in Europe with benchmark crude for March delivery up 50 cents at $72.39.

The dollar rose to 89.70 yen from 89.17 yen and the euro gained to $1.3729 from $1.3650.

[Associated Press; By CARLO PIOVANO]

AP Business Writer Joe McDonald in Beijing contributed to this report.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Investments

< Recent articles

Back to top


 

News | Sports | Business | Rural Review | Teaching & Learning | Home and Family | Tourism | Obituaries

Community | Perspectives | Law & Courts | Leisure Time | Spiritual Life | Health & Fitness | Teen Scene
Calendar | Letters to the Editor