European stock markets mostly rose yesterday after suffering stiff losses early in the week, as gloomy economic news was offset by upbeat earnings statements by European blue-chips, analysts said.
London’s benchmark FTSE 100 index closed essentially unchanged at 5,498.32 points, despite news that Britain’s recession deepened substantially in the second quarter of 2012.
British gross domestic product slumped by a worse-than-expected 0.7 per cent in the three months to June, according to official data published just ahead of the London Olympics.
Elsewhere, the Paris CAC 40 gained 0.23 per cent to 3,081.74 points and Frankfurt’s DAX 30 rose by 0.25 per cent to 6,406.52 points as investors set aside news of sliding German investor confidence.
Italian and Spanish markets rebounded, clawing back some of their recent losses suffered on eurozone debt crisis concerns. Milan jumped 1.17 per cent and Madrid added 0.82 per cent.
“Earnings from leading European blue-chips have helped the positive bias today, with auto stocks outperforming the wider market,” at least in Germany, ETX Capital Market analyst Ishaq Siddiqi wrote.
Some gains were also noticed after Austrian central bank governor Ewald Nowotny, a member of the European Central Bank governing council, said that the future EU financial rescue fund might be granted a banking licence.
That would allow it to exchange bonds for ECB cash, bolstering its capacity without governments having to contribute additional funds.
In foreign exchange deals, the euro climbed to $1.2127 from $1.2063 in New York late on Tuesday, when it had tumbled to a two-year low at $1.2043.
The Dow Jones Industrial Average of 30 blue-chip stocks was up 0.33 per cent at 12,658.68 points, but the S&P 500-stock index fell 0.26 per cent to 1,334.79 and the tech-rich Nasdaq dropped 0.47 per cent to 2,849.57.
Global crude prices fell yesterday, reversing early gains, as the United States revealed a surprise jump to its crude stockpiles, traders said.
Prices were also downbeat amid persistent concerns over the eurozone debt crisis, they added.
Brent North Sea crude for delivery in September fell 60 cents to $102.82 a barrel in late London deals.
World oil prices had rebounded Tuesday on encouraging Chinese manufacturing data. They had plunged by more than $3.50 on Monday as eurozone debt strains, centred on Spain, pointed to future weak demand for the commodity.
The oil market hit two-month highs last week as traders worried that rising tensions in the crude-rich Middle East – particularly in Iran and Syria – would hamper supplies.