European stocks close higher2 min read . Updated: 21 Apr 2010, 12:39 AM IST
European stocks close higher
European stocks close higher
London: European stock markets closed higher on Tuesday, buoyed by strong US corporate results, notably from under-fire US investment bank Goldman Sachs, and positive German data, dealers said.
They said that after recent losses and a hesitant start, investors were happy to take their lead from Goldman Sachs which reported that it nearly doubled its first quarter earnings, easily beating market forecasts.
That lead was enough to at least allay some concerns over US and British probes into alleged fraud at Goldman Sachs, charges the company has forcefully rejected.
News of a sharp pick-up in German investor confidence in April also helped after recent worries that Europe’s powerhouse economy might have faltered in the first quarter.
The closely watched ZEW economic research institute said its financial sector indicator jumped eight points to 53 points on the back of strong exports, well above the 46 points forecast by analysts.
Dealers said the prospects of European airlines getting back to normal after unprecedented disruption caused by the Iceland volcano eruption remained very uncertain but there appeared at least to have been more flights on Tuesday.
In London, the benchmark FTSE 100 index closed up 0.97% at 5,783.69 points. In Paris, the CAC 40 index jumped 1.41% to 4,026.65 and in Frankfurt, the DAX gained 1.65% to 6,264.23 points.
“The (Iceland) ash cloud situation seems to have abated somewhat over the last 24 hours with some flights in Europe taking off this morning," said analyst Joshua Raymond at financial spread-betting firm City Index.
“This improvement, along with the late gains in the US markets (overnight), has helped to settle some investor nerves and this has triggered some small bargain hunting," Raymond added.
In Paris, dealers noted that continued troubles for Greece in raising fresh funds and coping with its massive debt and budget deficit had little impact on sentiment.
“If the market had been in a down mood, it could easily have got caught up on this (Greek news)," said Guillaume Garabedian of Meeschaert Gestion Privee.
On Wall Street, the blue-chip Dow Jones Industrial Average was up 0.32% at around 1600 GMT while the tech-rich Nasdaq Composite added 0.59%.
“The Goldman Sachs situation is still front-and-center, particularly with Goldman reporting much better-than-expected earnings," said Patrick O’Hare of Briefing.com.
Goldman’s SEC woes aside, investors appeared to be reassured by the firm’s earnings, transferring gains to other players in the sector while the other banks did well on the back of strong figures and growing hopes the economy is emerging from the recession.
“Our performance in the first quarter reflects more signs of growth across the economy and the strength of our client franchise," said Goldman chief executive Lloyd Blankfein.
Elsewhere in Europe, Amsterdam gained 1.80 percent, Brussels was up 0.49% Madrid added 0.95 %, Milan jumped 1.94% and Swiss stocks put on 0.56%.
In Asian trade earlier Tuesday, Tokyo closed flat, Hong Kong added 1.02% and Shanghai was virtually unchanged as investors there continued to be wary of any further clampdown on the property market by Beijing.
Sydney dropped 0.22%.