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European stocks climb to 4 1/2-yr high before summit

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Bloomberg Athens
Last Updated : Mar 15 2013 | 1:13 AM IST
European stocks advanced to a four-and-a-half-year high as the region's policy makers gathered for a two- day summit in Brussels.

Assicurazioni Generali SpA rallied the most since May 2010 after Italy's biggest insurer reported increased operating profit. HeidelbergCement AG soared to the highest since 2008 as debt declined more than estimated. Deutsche Lufthansa AG climbed 3.7 per cent as Europe's second-largest airline agreed to buy aircraft from Airbus SAS.

The Stoxx Europe 600 Index gained 1.1 per cent to 298.51 at 4:30 pm in London, the highest level since June 2008.

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The benchmark measure has risen 6.7 per cent this year as data on U.S. payrolls and Chinese exports bolstered confidence in the global economic recovery and central banks around the world continued stimulus measures.

"Markets are grinding higher, pushed by better-than-expected US data resisting fiscal headwinds," said Witold Bahrke, who helps oversee $55 billion as senior strategist at PFA Pension A/S in Copenhagen. "On the other hand, anxiety is growing steadily, primarily regarding Euro-zone developments. Nobody is expecting anything concrete from the summit, but there is the potential for surprises, for example on Cyprus."

European summit
European leaders gathered for a two-day summit on Thursday, with Euro-area finance ministers meeting separately tomorrow to discuss a bailout for Cyprus. Policy makers may loosen austerity measures as the recession and mounting unemployment in southern Europe overtake the debt crisis as the region's biggest headache.

The number of shares changing hands in Stoxx 600 companies was 1.7 per cent higher than the 30-day average today, according to data compiled by Bloomberg.

National benchmark indexes climbed in 15 of the 18 western European markets. The UK's FTSE 100 rose 0.8 per cent and Germany's DAX added 1.1 per cent. France's CAC 40 climbed 0.8 per cent.

Generali rose 9.4 per cent to Euro 13.33.
The insurer said fourth-quarter operating profit increased 12 per cent from a year earlier to 928 million euros ($1.2 billion), boosted by the non- life insurance business.

HeidelbergCement debt
HeidelbergCement advanced 2.9 per cent to 56.16 euros, the highest price since October 2008. The German cement maker said debt declined more than expected last year as improved earnings covered dividends and repayments. Borrowings fell 700 million euros to 7 billion euros, while analysts had predicted 7.4 billion euros.

Lufthansa rose 58 cents to 16.07 euros. The company agreed to renew its short-haul fleet with 100 mostly fuel-efficient aircraft from Airbus, as the airline seeks to cut kerosene costs that constitute its single biggest expense.

Booker Group Plc, Britain's biggest food wholesaler, jumped 8 per cent to 125.3 pence, the highest price in seven years, after the UK Competition Commission provisionally approved its acquisition of Makro Holding Ltd.

Aggreko Plc added 6.7 per cent to 1,963 pence as the world's largest provider of mobile power supplies won a contract in Mozambique and Namibia.

France Telecom
France Telecom SA and Telefonica SA rose 6.1 per cent to 8.43 euros, and 3.9 percent to 11.50 euros, respectively. A gauge of telecom stocks was the best performer among the 19 industry groups on the Stoxx 600.

K+S AG gained 2 percent to 36.78 euros after Europe's largest potash maker predicted earnings and revenue will increase this year.

OC Oerlikon Corp fell 2 per cent to 12.40 Swiss francs, paring an earlier loss of as much as 4.4 per cent. The world's largest maker of textile machinery will appoint a new chief executive officer to replace Michael Buscher, who led the company through a reorganisation since joining in 2010.

Chief Financial Officer Juerg Fedier will act as interim CEO, the Pfaeffikon, Switzerland-based company said, without giving any reason for the switch.

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First Published: Mar 15 2013 | 12:33 AM IST

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