Markets & Finance

Europe, Asia Higher


European stock markets were higher Wednesday. In London, the Financial Times-Stock Exchange 100 index rose 47.00 to a 3-month high 5011.00 as interest rate yields plunged on news U.K. May PMI dropped to 47.3 from 49.1 in April. Sterling was off at $1.8118 on the perception Bank of England might have to cut rates to bolster economy. 83 FTSE stocks rose, 17 fell on turnover of 1,534,000,000 shares. Yields on 10-year gilts fell to 4.24% from 4.30% yesterday as U.S. yields plunged. Shell Transport, Cairn Energy, and BP rose as July Brent crude oil futures jumped. Reckitt Benckiser rose after CSFB reiterated its "outperform" rating on stock. T&F Informa rose after agreeing to buy IIR Holding to expand its events organizing and training business.

In Germany, the DAX Index, ignoring weak May PMI report, rose 66.54 points to a 3-year high of 4527.17 as lower interest rates bolstered hopes for economic improvement. 29 DAX stocks rose, 1 fell on turnover of 105,785,000 shares. Yields on 10-year Bunds fell to 3.23% from 3.26% yesterday. The euro was down to $1.2234 as Dutch voters were seen following the French in rejecting European Union constitution in today's referendum. BMW and DaimlerChrysler rose on a weaker euro and stronger dollar. Volkswagen rose after its Audi unit said it boosted sales 14% last month. Altana was lower after Goldman Sachs cut the company's 2006 earnings per share forecast. Jenoptik was lower after Fitch cut its credit rating. Linos fell as company said the insolvency of German photo filmmaker AgfaPhoto GmbH may cut earnings this year.

France's CAC 40 rose 57.52 points to 4178.25 on short covering and hopes lower interest rates will boost economy. 36 CAC stocks rose, 4 fell on turnover of 96,064,000 shares. Yields of 10-year bonds fell to 3.24% from 3.28% yesterday. Total SA rose as crude oil futures climbed to three-week highs. Vinci rose after Morgan Stanley initiated covering of the stock with an "overweight" rating. Suez rose after UBS raised its rating on stock to "buy" from "neutral". EADS fell as Singapore Airlines and Qantas sought compensation for a six-month delay in delivery of a new A380 plane.

Asian markets were also higher on Wednesday. In Japan, the Nikkei 225 rose 53.08 points, or 0.47%, to 11,329.67. Tokyo's Nikkei 225 extended a five-day winning streak, and closed above 11,300 for the first time since mid-April. Automakers Toyota Motor and Honda Motor rose on solid domestic auto sales. Mitsubishi Motors soared +7.41% on a rise in its May new car sales, the first year-over-year rise in almost 18 months, and on its announcement that its Indian partner Hindustan Motors Ltd has agreed to expand production of Mitsubishi's Lancer sedans at an HML plant starting in January. One losing issue to note is Itoham Foods, which fell 5.65% on a Nihon Keizai report saying that the company is under investigation on suspicion of customs-duties evasion estimated more than 300 million yen.

In Hong Kong, the Hang Seng rose 6.00 points, or 0.04%, to 13,873.07. The Hang Seng finished marginally higher on gains in Hutchison Whampoa and Chinese telecoms. The index's rise was limited following a weak session on Wall Street overnight and as investors continue to stay sidelined ahead of upcoming China IPOs.

Canada's benchmark TSX/S&P gains 46.86 points, or 0.49%, to close at 9,654.16.


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