European stocks rise as euro jumps on mixed US data

Europe’s main stock markets drifted higher and the euro rose yesterday, as investors tracked mixed data from the US and took confidence over developments in the Greek debt crisis.

London’s benchmark FTSE 100 index of leading shares added 0.42 per cent to 5,965.58 points, the Paris CAC 40 added 0.41 per cent to 3,594.83 points and in Frankfurt the DAX 30 rose 0.19 per cent to 7,157.82 points.

Elsewhere, Amsterdam rose by 0.31 per cent, Milan by 0.52 per cent, Brussels by 0.94 per cent and Zurich by 0.14 per cent. Lisbon fell by 0.37 per cent.

The European single currency rose sharply to $1.3179 from $1.3082 late in New York on Thursday.

In afternoon trade on Wall Street, the Dow Jones Industrial Average was up 0.07 per cent to 13,262.41 per cent, the broad-market S&P 500 edged up 0.19 per cent to 1,405.20 points, while the tech-heavy Nasdaq Composite rose 0.10 per cent to 3,059.43 points.

Traders were hesitant after the strong stocks runup this week and with new US data not giving a clear direction for the economy.

“There are growing concerns in the market that the 2012 rally in equity markets has become extremely overbought and ripe for setback,” said the US-based Hightower Report.

The Labour Department re­ported a pickup in overall consumer prices in February, but it placed the blame almost entirely on surging pump prices for gasoline: food prices were flat, and the core consumer price index rose just 0.1 percent, slower than in January.

Federal Reserve data on industrial production gave an overall picture of only modest expansion in the sector so far this year, with flat growth in February following a 0.4 per cent rise in January.

Meanwhile the University of Michigan index of consumer confidence fell by 1.0 point to 74.3, after analysts had forecast a slight rise.

“European markets have lacked conviction in pushing higher today at the end of a fairly positive week on both sides of the Atlantic,” said CMC Markets analyst Michael Hewson.

“This afternoon’s slightly disappointing US data has taken some of the edge of the recent bullish sentiment as investors weigh up the risks from rising oil prices, against a slightly more positive US outlook,” he added.

Asian markets ended mixed as lingering concerns over elevated oil prices and China’s slowing economy tempered upbeat US economic data, traders said.

Sentiment was also boosted after the International Monetary Fund on Thursday approved a second rescue loan for debt-riddled Greece, joining the EU again in an attempt to save the country from bankruptcy.

The IMF executive board authorised a four-year, 28-billion-euro ($36.7-billion) loan for Greece “in support of the authorities’ economic adjustment programme,” the global lender announced overnight.

Trader Anita Paluch at Gekko Global Markets said that the news had averted a potentially disastrous default by Athens.

In Asia on Friday, Hong Kong’s main stock index closed down 0.17 per cent and Seoul fell 0.46 per cent, while Tokyo and Sydney finished flat.