The Electrolux logo is seen during the IFA Electronics show in Berlin (file). Electrolux shares plummeted 13.4% yesterday after GE pulled the plug on plans to sell its appliance unit to its Swedish rival.
European stock markets rallied yesterday, appearing to win support from an early pre-Christmas bounce, traders said, but shares in Electrolux plunged after GE pulled the plug on plans to sell its appliance unit to its Swedish rival.
Frankfurt’s DAX index was up 2.0% at 6,254.69 points compared with Friday’s close and the CAC 40 in Paris rallied 1.4% at 4,781.12 points.
Outside the eurozone, London’s benchmark FTSE 100 index won only 0.3%, or 6,254.69 points, as energy stocks fell stongly as oil prices hit their lowest level in six and a half years.
German industrial production increased slightly in October, driven by rising activity in the manufacturing and construction sectors, the economy ministry said yesterday.
The ministry calculated that factory output increased by 0.2% in October compared with a month earlier, corrected for seasonal factors.
In September output had contracted by 1.1%.
In foreign exchange activity, the euro slid against the dollar.
One of the biggest movers in European trading was shares in Electrolux, which took a wringing in Stockholm, after rival General Electric abandoned plans for the Swedish company to take over its appliances businesses due to opposition of US authorities to the deal. Electrolux shares plummeted 13.4%.
Overall, European traders were playing catch up with a surge on Wall Street seen Friday after strong US jobs reading provided fresh evidence that the world’s biggest economy is recovering and reinforced expectations of a December interest rate rise from the Federal Reserve.
The US Labour Department on Friday said that 211,000 jobs were created in November and the unemployment rate held at 5%.
Wall Street’s three main indexes jumped more than 2% on the report.
“The market appears to have read the data as reason for confidence in the economic outlook, rather than taking flight at the prospect of imminent reduction in US Fed stimulus,” said analyst Kymberly Martin at Bank of New Zealand.
While a lift in US borrowing costs would usually be expected to cause selling of equities, analysts said dealers have been soothed by indications from the Fed that any increases would be small and gradual.
With a US rate increase almost certain, the dollar pushed higher against the yen and euro. The single currency was also weighed down by comments last week from ECB chief Mario Draghi that the European Central Bank could strengthen its stimulus.
Wall Street opened to the downside yesterday, with petroleum-linked equities tumbling as London oil prices sank to their lowest level in six and a half years.