European stock markets closed higher yesterday, given a boost by strong German economic data in thin holiday trade.
With London and Wall Street shut for public holidays, investors had little to go on but welcomed positive employment, consumer spending and manufacturing figures in Germany, Europe’s biggest economy.
In Paris, the CAC-40 index gained 1.98 per cent to 3,222.30 points and in Frankfurt the DAX 30 jumped three per cent to 6,075.52 points.
Other markets showed similar gains with Milan up 2.42 per cent as Madrid put on 1.84 per cent despite Spain’s new government warning that the 2011 public finances will prove to be in even worse shape than first thought.
The euro was slightly easier at $1.2924, down from $1.2939 in New York late on Friday as investors waited to see what the next turn in the eurozone debt crisis would be ahead of another EU summit at the end of the month.
The euro was at 99.42 yen, after 99.62 yen on Friday when the single currency fell below the 100-yen mark for the first time in 10 years. Stock gains were led by Frankfurt after the German Chamber of Commerce and Industry DIHK said that private consumption in Germany was at its strongest level for more than a decade in 2011 despite the ongoing euro crisis.
Separately, official figures showed the number of people in work hit a record 41.04 million, with more than half a million jobs created last year.
The German economy appears to be holding up despite the long-running debt crisis thanks to the deep restructuring it has undertaken in recent years.
Finance Minister Wolfgang Schaeuble, in a newspaper interview, said that while 2012 would probably be more difficult than 2011, the German economy was still in “good shape.”
French brokerage Aurel BGC said that in the new year “investors will be divided between US economic data, which should confirm the worst-case-scenario is far from being the most likely in the United States, and news from the eurozone, which will let us judge more precisely the depth of the recession that began in the last quarter” of 2011.