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European Shares Gain On Chinese Industrial Profits Print E-mail
Daily Forex Fundamentals | Written by ICN.com | Jan 28 13 09:08 GMT

European stocks opened in positive territory on Monday, continuing the rally seen in Asian markets after data showed profits at China's industrial firms increased for a fourth successive month in December, adding to signs the country's economic rebound is gaining momentum.

Equities in Europe extended gains following gains in Asian stocks as industrial companies in China posted fourth months of profits, as it rose in December which added to signs that the world’s second largest economy rebounding after the recent period of instability amid global foggy scene.

Chinese economy is expected to notice many improvements during the upcoming period amid the current positive indicators and efficient performance, where the nation’s currency began to stabilize.

Growing optimism about the economic outlook after positive indicators and upbeat earnings has put global equity markets on a strong footing.

As of 03:11 EST, the French CAC 40 was rose to 0.08% to 3,781.14 points; German DAX rose slightly 0.02% to 7,859.55 points, FTSE 100 traded higher by 0.05% to 6,287.83 points. STX Europe 600 fell 0.03% to 289.63.

Meanwhile, the troika of the European Commission, European Central Bank and International Monetary Fund officials will assess the latest economic developments and policy implementation done by the Irish government for their quarterly review mission this week.

IMF team is also set to visit Spain on Monday to conduct its second review of the country's weak financial sector. IMF has been monitoring the country's banking to help assessing the amount of recapitalization needed to restore it to health.

The ECB chief Mario Draghi disagreed with Germany's finance minister over the importance of a bailout for Cyprus. Cyprus, which holds a lot of Greece’s dept, is seeking financial aid after a European Union approved to write-down Greek debt, causing huge losses on Cyprus’s banks.

Draghi rejected Wolfgang Schaeuble's view that Cyprus is not "systemically relevant" and its bankruptcy would not endanger the rest of the euro zone. Germany and some other euro zone states seem uneasy about bailing out Cyprus.

As of 10:31 AM (GMT +2), the EUR/USD hovered around $1.3427 after opening at $1.3463. So far, the pair set a session high of $1.3470 and low of $1.3426.

Italy will hold a bond auction on Monday, where the country hopes to sell between 3 and 3.5 billion Euros worth of bonds. The outcome of the sales could be considered an indicator of investor sentiment towards the country.

The auction comes ahead of next month's national elections and after the country's third largest bank, Monte dei Paschi di Siena last week exposed loss-making transactions in the stock exchange which will probably cost up to $1 billion.

Across the Atlantic, investors await the Federal Reserve's rate decision, the Gross Domestic Product numbers, alongside the much-anticipated Jobs report. The Senate will vote on the House’s debt ceiling bill. The Standard & Poor's 500 settled above 1,500 points for the first time in more than five years.

 

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