In Europe Retail Gets a Breather on Sainsbury’s results (Reuters) (10-01-2008)

LONDON, Jan 10 (Reuters) - Stock markets in Europe advance in early trading on Thursday following British grocer J Sainsbury quarterly results before the central bank is scheduled to announce rate decisions.

Shares in Sainsbury rallied by more than 7 percent, after Britain's third-largest supermarket chain met analysts' expectations with its quarterly trading figures. This was particularly significant at this point as retailers have been one of the worst performing sectors so far in 2008 as fear of a slowdown in consumer spending both in Britain and the United States.

By 0810 the FTSEurofirst 300 index of top European shares was up 0.6 percent at 1,457.14 points. The index fell 1.2 percent on Wednesday, but rallied up from the day's lows as U.S. stocks rallied thanks to a broad push into traditional defensive sectors such as healthcare.

In the words of Edmund Shing, a strategist at BNP Paribas in Paris, “we want to see some better macro data and we need some reassurance that the world is not going to hell before we can bounce back more meaningfully.”

Financials were rallying strongly just as the European Central Bank is expected to keep euro zone rates at 4.00 percent and a decision from the Bank of England is anticipated to either cut the rate from 5.5 percent or leave it unchanged.

Among banks in this top performing sector were Royal Bank of Scotland, which was gaining 1.7 percent, Barclays rising by 1.3 percent, while BNP Paribas advanced by 0.3 percent and Societe Generale  gained 1 percent.

Around 8:40 GMT, the regions main indices were as follows: London's FTSE 100 index gained 0.6 percent, while Frankfurt's DAX and Paris' CAC 40 rose 0.5 percent.

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