London: European shares advanced for a third straight session on Wednesday, led higher by financial stocks, with sentiment improving on signs that the European Union may rescue heavily indebted Greece.
At 1:42pm, the FTSEurofirst 300 index of top European shares was up 0.8% at 988.54 points after gaining 0.2% in the previous session. The index, which fell nearly 4% last week, is up 53% from a record low in March 2009.
Banks were among the top gainers, with Standard Chartered, HSBC, Barclays, Lloyds, Royal Bank of Scotland, BNP Paribas and Societe Generale rising 1.2 to 2.3%.
“May be the market has exhausted its neurosis near term. You can’t have a sell-off every day on the basis of Greece. The market is consolidating, but is still in a cyclical bull phase,” said Bernard McAlinden, investment strategist at NCB Stockbrokers, in Dublin.
“It’s highly unlikely that there will be any decisive bailout in the form of debt guarantees for Greece or any of the other peripheral economies. The onus is still very much on the Greeks to make necessary adjustments,” he added.
European governments have agreed in principle to help Greece, a senior German coalition source said on Tuesday, in what would be the first rescue of a euro zone member in the currency’s 11-year history.
The comments were the strongest signal so far that European Union economic heavyweight Germany may be ready to step in to stave off a crisis of confidence in the 16-nation currency bloc that has roiled markets around the globe.
ArcelorMittal, the world’s top steelmaker, fell 5.3%. It forecast higher shipments but lower prices in the first three months of 2010 and a core profit that could fall from a fourth-quarter figure that just missed expectations.