1:45 PM Frankfurt Ė The European indexes rose and the ECB may set yield limits for sovereign bonds. Construction output in the euro zone fell in June. UK home prices slumped in August. Heineken raised its offer to acquire Fraser & Neave''s stake in Asia Pacific Breweries.
European indexes edged higher in early morning trading as traders and political leaders return from vacation. President of Greece is scheduled to visit Berlin this Friday and the leader of the euro zone is expected to visit Greece as early as tomorrow.
Greece is likely to demand additional time and relaxing of austerity measures as the nation battles depression like economic conditions and struggles with record high unemployment and falling government receipts.
The European Central Bank is contemplating setting limits on yields of bonds of each euro member state at the governing council meeting in September, Germany''s Spiegel magazine reported without citing sources.
Greek Prime Minister Antonis Samaras is due to meet Luxembourg Prime Minister Jean-Claude Juncker, German Chancellor Angela Merkel and French President Francois Hollande this week to seek a two-year extension of the fiscal consolidation program.
In economic news, home prices in the United Kingdom declined but household finance index rose in August. Construction output in the euro zone dropped 0.5% in June.
In earnings news, Amlin swung to first-half profit and Bovis pre-tax profit for the half year soared 100%.
In Paris trading, the CAC-40 Index gained 13.41 or 0.4% to 3,501.79 and in Frankfurt the DAX Index edged higher 34.63 or 0.5% to 7,075.34.
The yields on Spainís benchmark 10-year bonds fell 23 basis points to 6.16%. Italian 10-year yields dropped nine basis points to 5.72%.
Euro zone Output Falls
Seasonally adjusted construction output in the euro zone dropped 0.5% in June following a revised 0.2% drop in May, Eurostat reported today.
On a yearly basis, production fell 2.8% in June compared to the 8.1% drop a month ago.
UK Home Prices Slump
Home prices in the United Kingdom recorded the largest decline ever in August, property tracking Web site Rightmove said today.
The average asking price for a home in the United Kingdom fell 2.4% on a monthly basis in August to £236,260, following a 1.7% contraction in July.
On a yearly basis, home prices rose 2% in August following the 2.3% rise in July.
Separately, the UK household finance index rose for the third straight month in August, a survey from Markit Economics showed.
The index climbed to 38.9 in August, from 37.5 in July.
The surveyed households were less pessimistic about the outlook for their finances over the next 12 months. The index rose for the fourth month running to 43.5 in August, from 43.1 in July.
Dutch Sentiment Steady