The light trail from a euro sign sculpture is seen outside the European Central Bank’s (ECB) headquarters in Frankfurt (file). Speculation about whether the ECB would further boost its massive stimulus programme increased yesterday after the bank reported that during October, loans to the private sector rose 1.0% from a year ago, compared with a growth of 0.6% recorded in September.
AFP
London
European stock markets rose solidly for a second day running yesterday following gains across Asia.
Indices had rebounded Wednesday on receding worries about Russian-Turkish tensions, while US gains were muted following a stream of economic data ahead of the Thanksgiving holiday on Thursday with Wall Street closed.
Strong advances in London, Paris and Frankfurt marked a welcome shift from Tuesday’s pullback in the wake of the shooting down of a Russian warplane by Turkey on the Syrian border.
London’s benchmark FTSE 100 index ended the day up 0.88% compared with Wednesday’s close.
In the eurozone, Frankfurt’s DAX 30 index shot up 1.35% and
the Paris the CAC 40 won 1.08%.
“With the US on holiday and a rate hike priced in to the market for next month, attention lies squarely on the eurozone as investors debate how effective the next round of anticipated monetary easing will be,” said Mike McCudden, head of derivatives at stockbroker Interactive Investor.
Speculation about whether the European Central Bank would further boost its massive stimulus programme increased yesterday after the ECB reported that during October, loans to the private sector rose 1.0% from a year ago, compared with a growth of 0.6% recorded in September.
Some analysts saw it as a sign that the monetary stimulus is working, but Capital Economics analyst Jack Allen said the pace of growth in private sector loans remained slow and did not suggest a strong economic pick-up.
“All of this is likely to have strengthened ECB policymakers’ conviction that more policy stimulus is needed,” Allen said, predicting a further rate cut and an expansion of the asset purchase programme
In foreign exchange Thursday, the euro stood at $1.0613, down from $1.0622 in late US trade on Wednesday.
In Asia, Chinese energy firms advanced following the latest moves to reform the country’s bloated state-owned enterprises.
“Asian shares advanced yesterday, while the euro remained under pressure on growing bets that the European Central Bank will roll out more stimulus soon even as the US Federal Reserve looks set to raise interest rates,” said ETX Capital trader Michael Going.
A string of positive US data — falling jobless claims, an increase in durable goods orders and rising new home sales gaining — on Wednesday reinforced expectations the Federal Reserve will lift US interest rates next month.
