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Market Update

European Markets Higher, Leaders Agree to Trim EU Budget

Author: Barry Randall
Last Update: 9:39 AM ET February 08 2013

4:00 AM Frankfurt European markets edged up after European Union leaders agreed to trim the budget spending in the next seven-year plan. Oil gained after China reported a surge in exports in January indicating recovering demand in domestic and world markets.

European markets gained after European leaders agreed on a smaller than expected fiscal budget and China reported higher than expected trade data in January lifting commodities prices.

In London FTSE 100 index increased 31.5 or 0.5% to 6,260 and the DAX index added 0.4% or 27.7 to 7,619. In Paris, CAC 40 index gained 25.6 or 0.7% to 3,627.

For the year so far, the FTSE 100 index is up 6.1%, the DAX has gained 0.1% and the CAC 40 is down 0.4%.

Market indexes in 16 of the 17 countries increased across the currency zone.

European Union leaders are closer to an agreement to limit budget for the period between 2014 and 2020, after prolonged talks in Brussels. The current consensus appears to be near 960 billion euros compared to 994 billion euros earmarked to spend for the current year.

Market sentiment was bolstered after China reported higher than expected increase in trade in January. Exports rose 25% and gained 12.4% after adjusting for holiday calendar. Imports soared 28.8% and gained 3.4% after calendar adjustments.

Last year, Chinese factories were closed for a week on the account of Lunar New Year. This year the New Year falls in February.

Stocks in Review

Banks were in focus in active trading in Paris and in Frankfurt.

Credit Agricole SA increased 6% to 7.29 euros, Societe General SA gained 2.4% to 31.81 euros and BNP Paribas SA added 2% to 44.34 euros.

Commerzbank increased 2% and Allianz SE added 0.4%. Deutsche Bank increased 0.2%.

Online gambling stocks in London were higher after New Jersey Governor Chris Christie said he would permit online wagering for gambling conducted by Atlantic City casinos.

B.win Party Digital Entertainment Plc soared 20% to 140.1 pence and 888 Holdings Plc surged 14% to 132 pence.

Software AG increased 60 cents to 29.05 euros after the second largest German software developer said it will buy back stocks worth as much as 180 million euros.

TDC A/S decreased 2.3% to DKK40.05 after local media reports suggested that the Danish telecom company has increased stock sale to 120 million shares compared to 80 million shares in an offering managed by UBS AG.

Telecom Italia declined 1.2% to 67 euro cents after the telecom operator reported operating earnings of 11.7 billion euros, ahead of analyst estimates.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc