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Markets

European stocks remain sharply higher; Dax up 2.17%

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Investing.com - European stocks remained sharply on Wednesday, as market sentiment strengthened broadly after U.S. lawmakers voted the budget bill slated to prevent the country from falling into recession.

During European afternoon trade, the EURO STOXX 50 surged 3.62%, France's CAC 40 rallied 2.27%, while Germany's DAX 30 jumped 2.17%.

U.S. lawmakers passed a compromise bill on Tuesday to avoid the fiscal cliff, blocking a series of looming tax increases and spending cuts that could have pushed the U.S. economy back into a recession.

U.S. President Barack Obama hailed the deal as "just one step in the broader effort to strengthen the economy".

The U.S. president was speaking after the House of Representatives passed a Senate-backed bill by 257 votes to 167.

Financial stocks pushed higher, as shares in French lenders Societe Generale and BNP Paribas surged 4.90% and 3.99%, while Germany's Deutsche Bank and Commerzbank jumped 3.82% and 5.23% respectively.

Peripheral lenders also posted sharp gains, as Italy's Unicredit and Intesa Sanpaolo soared 3.62% and 4.62%, while Spanish banks BBVA and Banco Santander climbed 3.45% and 2.46%.

Elsewhere, ArcelorMittal rallied 3.75% after China Steel and Posco led a group that agreed to pay USD1.1 billion for a 15% stake in ArcelorMittal Mines Canada, in order to secure supplies of iron ore.

In London, commodity-heavy FTSE 100 advanced 2.12%, after data showed that manufacturing activity expanded unexpectedly in December, growing at the fastest pace since September 2011.

Steel maker Evraz remained sharply higher, with shares surging 5.99% and Eurasian Natural Resources jumped 5.90%, while mining giants Rio Tinto and BHP Billiton climbed 5.95% and 4.14% respectively.

Copper producers Xstrata and Kazakhmys added to gains, with shares surging 5.74% and 5.21%, while oil and gas majors Anglo American and BP rallied 5.13% and 1.33%.

Meanwhile, U.K. lenders continued to track their European counterparts sharply higher. HSBC Holdings jumped 2.86% and the Royal Bank of Scotland advanced 3.07%, while Lloyds Banking and Barclays soared 4.24% and 4.74%.

In the U.S., equity markets pointed to a sharply higher open. The Dow Jones Industrial Average futures pointed to a 1.23% jump, S&P 500 futures signaled a 1.51% gain, while the Nasdaq 100 futures indicated a 1.56% surge.

Also Wednesday, Markit research group said that Spain's manufacturing purchasing managers' index declined to 44.6 in December from a reading of 45.3 the previous month. Analysts had expected the index to tick down to 45.1 last month.

Later in the day, the Institute of Supply Management was to produce a report on manufacturing growth in the U.S.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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