EUROPE MARKETS: European Stocks Boosted By Greek Bailout Deal, Gains For Oil
May 25 2016 - 5:19AM
Dow Jones News
By Carla Mozee, MarketWatch
Energy shares gain as oil tries for $50
European stocks advanced Wednesday, hovering near a one-month
high, as international creditors reached a deal to unlock more
bailout funds for Greece, and as oil prices tried for $50 a
barrel.
The Stoxx Europe 600 was up 1.1% at 347.77, moving toward its
highest close since April 28, according to FactSet data. All
sectors rose, led by the financial and oil and gas groups. The
pan-European index was on track for a second consecutive gain,
after Tuesday's session closed up by 2.2%
(http://www.marketwatch.com/story/european-stocks-turn-higher-led-by-gains-for-banks-2016-05-24).
Greek deal: Greek bond prices pushed higher as Greece is now in
line to receive 10.3 billion euros ($11.48 billion) in new loans
(http://www.marketwatch.com/story/breakthrough-greek-debt-deal-reached-with-eurozone-imf-2016-05-24),
if a deal struck early Wednesday is signed off by the 19 member
countries in the eurozone.
As bond prices rose, the yield on 1-year Greek bond fell 79
basis points to 6.82%, according to TradeWeb. The yield on 2-year
debt lost 26 basis points to 6.82%. Greece's Athex Composite rose
0.7% to 646.31.
The new payout comes after eurozone finance ministers and the
International Monetary Fund agreed that Greece has made the
necessary progress on reforms. The funding will help Athens from
defaulting on large debt redemptions to the IMF and European
Central Bank in July. The ministers also agreed on a potential road
map on debt relief for Greece.
"Greece's creditors reached a deal to avoid a summer car crash
in a way that only they know how, involving extension of
maturities, adjustment of interest rate payments with a good dose
of things still to be decided, some of them after the German
federal elections next year," said Simon Smith, chief economist at
FxPro, in a note.
"Still, for the single currency, this has removed one of the
potential risks for the summer, with the deal unusually being
reached comfortably ahead of the loan disbursement next month," he
said.
The euro was up 0.1% to $1.1153.
Oil: Energy shares were supported as oil prices crept toward $50
a barrel
(http://www.marketwatch.com/story/crude-oil-rockets-to-near-50-a-barrel-as-data-hints-at-us-supply-drop-2016-05-25)
, with the move coming after industry data pointed to decreases in
U.S. crude inventories. Official stockpile data will be released by
the Energy Information Administration later Wednesday.
Among energy producers, Spain's Repsol SA (REPYY) rose 2.4%, and
Italy's Eni SpA (ENI.MI) gained 1.6%. Oilfield services firm SBM
Offshore NV (SBMO.AE) picked up 0.4%.
Indexes: Germany's DAX 30 gained 1.5% to 10,211.47, while
France's CAC 40 moved up 1.2% to 4,482.83. The U.K's FTSE 100 added
0.7% to 6,264.33.
Italy's FTSE MIB picked up 1% to 18,088.08, and Spain's IBEX 35
advanced 1.9% to 9,086.80.
Movers: Marks & Spencer Group PLC (MKS.LN) shares dropped 8%
as the apparel and food retailer said profit fell 19% and warned on
margins
(http://www.marketwatch.com/story/marks-spencer-profit-down-19-warns-on-margins-2016-05-25).
Regus PLC (RGU.LN) shares bulked up 5.1% after RBC raised its
rating on the outsourcing services company to outperform from
sector perform.
Data: From Germany, the Ifo business-climate index rose to 107.7
in May
(http://www.marketwatch.com/story/german-ifo-business-climate-index-rises-in-may-2016-05-25),
better than the 106.8 reading expected by economists survey by The
Wall Street Journal.
(END) Dow Jones Newswires
May 25, 2016 06:04 ET (10:04 GMT)
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