4:00 PM Frankfurt – Financial markets across the European Union rebounded with a lift in resource stocks. Commodities stabilized at the end of a volatile week but weak global market outlook overshadowed market trading. Banks are ahead of schedule to repay a portion of loans from the European Central Bank next week.
European stocks inched higher Friday after resource stocks recovered and twenty nine banks are scheduled to repay early 10.94 billion euros of loans to the European Central Bank.
The FTSE 100 index in London rose 0.27% or 16.89 to 6,260.56 as commodities linked stocks rebounded. Vedanta Resources, Tullow Oil, Randgold and Anglo-American plc rose between 2% and 5%.
In Frankfurt, the DAX index fell 0.2% to 7,457.47 and the CAC 40 index in Paris gained the most, up 0.81% or 28.99 to 3,628.35.
Shares of GlaxoSmithKline, drug maker, fell 0.75 % in London after the Office of Fair Trading accused the firm of paying competitors to delay release of their own versions of GSK Seroxat treatment.
Financial markets in Europe declined in the week as cautious investors dumped shares on weak global economic outlook and poor company earnings.
Of the earnings released across the continent to date, 39% missed estimates, according to analysts.
Twenty nine banks will repay 10.94 billion euros of loans to the European Central Bank next Wednesday, sooner than anticipated.
Banks reimbursed 10.79 billion euros this week, after the European Central Bank offered more than 1 trillion euros in two tranches in December 2011 and February 2012.
The risk of failure is diminished, and banks can access unlimited liquidity, according to ECB president Mario Draghi.
Last year, the euro zone budget deficit fell 3.5% of gross domestic product from 4.2% a year earlier. The deficit is forecast to shrink to 2.8% in 2013.
The International Monetary Fund chief, Christine Lagarde, warned today growth in the UK economy was disappointing, ahead of the IMF and World Bank meetings in Washington today. Lagarde was cautious on austerity.
Incoming Bank of England governor Mark Carney echoed similar sentiments. The IMF cut the UK''s growth estimates in 2013 to just 0.7% Tuesday, down from the January forecast of 1%.
In Italy, the Democratic Party nominated former Prime Minister Romano Prodi for presidency, replacing out-of-favor Franco Marini, the original choice. However, the appointment of Prodi is far from secured as lawmaker prepare to vote in a secret ballot.
Average yield on the Italian 10-year bonds declined 2 basis points to 4.24%.
Statoil, Norway controlled oil company said Friday it discovered new oil deposits in the North Sea and estimates yield of between 40 million and 150 million barrels.
Norway already produces up to 3 million barrels of oil a day, the largest in Western Europe.