Specialist traders work on the floor of the New York Stock Exchange yesterday. The rise in the University of Michigan’s index on consumer sentiment to 83.7 in May, above the 78.5 estimated by analysts, helped push up stocks on Wall Street yesterday.

AFP/London

Europe’s main stock markets rebounded yesterday, with Paris jumping above 4,000 points for the first time since July 2011 as traders went bargain-hunting after earlier losses, dealers said.

Paris’s Cac 40 index climbed 0.56% to close the day at 4,001.27 points.

Meanwhile, in Frankfurt, the Dax 30 index closed with a fresh record high after gaining 0.34% to 8,398 points, and London’s FTSE 100 index added 0.53% to 6,723.06 points.

Rome added 0.34% to 17,604 points and Madrid rose 0.47% to 8,582.4 points.

“What we are seeing here is just another case of buying the dips,” analyst Craig Erlam at trading group Alpari said.

Markets had traded in negative territory for much of the morning, after overnight losses on Wall Street, as sentiment was hurt by weak economic data and speculation that the Federal Reserve was mulling an exit to its quantitative easing (QE) stimulus policy, dealers said.

According to Dow Jones Newswires, Federal Reserve Bank of San Francisco President John Williams said he was open to scaling back the Fed’s bond-buying programme in the coming months if the economy continued to improve.

“In light of reports this week that the Fed has mapped out a plan to exit QE, traders are on edge about the prospects of the US economic recovery,” said ETX Capital analyst Ishaq Siddiqi.

In foreign exchange deals, the European single currency slid to $1.2814 from $1.2881 late in New York on Thursday as the greenback won support from a solid report on US consumer sentiment.

The rise in the University of Michigan’s index on consumer sentiment to 83.7 in May, above the 78.5 estimated by analysts, also helped push up stocks on Wall Street.

In midday trade the Dow Jones Industrial Average was up 0.42% to 15,296.64 points, the broad-based S&P 500 increased 0.49% to 1,658.52 points, and the tech-rich Nasdaq Composite Index rose 0.47% to 3,481.67 points.

Elsewhere yesterday, the yen remained pressured by Japan’s enormous monetary easing policies.

The euro rose to ¥132.04 from 131.74 on Thursday. It had soared as high as ¥132.77 on Tuesday, touching the highest level since January 2012.

And the dollar rose as high as ¥103.13 yesterday, the highest level since the beginning of October 2008. It later settled back to ¥103.04, up from 102.25 on Thursday.

On the London Bullion Market, the price of gold dipped to $1,368.75 an ounce, from $1,381 late on Thursday.