European Factors to Watch-Shares set to rally on dovish Fed comments

Thu Jul 11, 2013 2:33am EDT

LONDON, July 11 (Reuters) - European stocks were expected to rally at the
open on Thursday on rising expectations the Federal Reserve will maintain its
ultra-loose monetary policy, which has supported equities, for longer than
expected.
    At 0627 GMT futures for the Euro STOXX 50, Britain's FTSE 100
, Germany's DAX, and France's CAC were up 1.5-1.7
percent.
    The Fed's chairman, Ben Bernanke, said late on Wednesday that the bank would
pursue a "highly accommodative policy ... for the foreseeable future", adding
the current unemployment rate of 7.6 percent may overstate the health of the
labour market and interest rates would not automatically be raised when the
unemployment hits the Fed's 6.5 percent target. 
    Stock markets and U.S. Treasuries, which recently sold off on concerns the
Fed may start to dial back its monthly bond-buying programme in light of a
healthier labour market, were boosted by Bernanke's comments.
    Asian stocks and U.S. index futures rose on Thursday
as investors piled into assets offering higher returns in the face of falling
U.S. Treasury yields, while the dollar weakened against a basket of currencies
.
    "The fruitless game of trying to out-think the Fed has just been proven
again," Justin Haque, a pan-European trader at Hobart Capital Markets said.
    "They hold all the data, therefore they hold all the controls. Yet again, in
both the (stock) indexes and the dollar, the combined doubting forces of the
intelligentsia waiting for a correction have been proved wrong."
    He expected Britain's FTSE 100, which closed 0.1 percent lower at
6,504.96 points on Wednesday, to hit 6,800 by next month and the euro zone Euro
STOXX 50 index, which shed 0.2 percent to 2,659.71 points, to rise
to 2,700.  
    The Euro STOXX 50 fell 12.5 percent between late may and late June on
concerns about a tighter monetary policy, although it has roughly recouped half
that drop on the back of better U.S. data and supportive comments by Fed
officials.
    Charts showed the index was now testing a resistance at 2,684 points,
corresponding to the upper end of a "bearish gap" opened on June 19-20, when the
Bernanke unveiled a timetable to reduce the Fed's stimulus programme.
    A break of that level may open the way for the index to rise towards its
May's high at 2,852.
      
--------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0627 GMT:
    
                                            LAST    PCT CHG  NET CHG
 S&P 500                                1,652.62     0.02 %      0.3
 NIKKEI                                14,472.58     0.39 %    55.98
 MSCI ASIA EX-JP                          516.96      3.1 %    15.53
 EUR/USD                                  1.3082     0.83 %   0.0108
 USD/JPY                                   98.67    -0.97 %  -0.9700
 10-YR US TSY YLD                          2.570         --    -0.10
 10-YR BUND YLD                            1.611         --    -0.04
 SPOT GOLD                             $1,292.51     2.28 %   $28.87
 US CRUDE                                $107.34     0.77 %     0.82
 
  
  > Asian shares hit 3-week high on Bernanke's dovish comments   
  > Wall St flat after Fed minutes, but Bernanke lifts futures   
  > Nikkei edges up in choppy trade after Bernanke's dovish tilt 
  > TREASURIES-Bond prices rise after Bernanke remarks           
  > Dollar tumbles after dovish Bernanke trip up bulls           
  > Gold climbs to 2-1/2 week high on Fed stimulus hopes         
  > Copper hits one-week high after dovish Fed comments          
  > Brent near 3-month peak as dollar wilts on Fed stance        
    
    COMPANY NEWS
    
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    Eight more cities in China, the world's biggest auto market, are likely to
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    ALLIANZ 
    Europe's biggest insurer expects to cash in on growing corporate demand for
insurance against computer hacking and internet breakdowns, it said on
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    AXA, CNP ASSURANCES, BNP PARIBAS, CREDIT
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    France has launched a double-pronged effort to harness insurers' deep
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seeking to ease their longtime reliance on bank funding. 
    
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a setback on Wednesday when Deutsche Bank objected to the disclosure of some SFO
documents. 
    
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    Norway's largest bank DNB warned of weakening loan demand in its home
market, especially in the in the corporate sector, as it reported second-quarter
results that beat expectations.
   Its net profit fell to 3.80 billion Norwegian crowns ($620.1 million) from
4.61 billion at the same time last year, beating the 3.67 billion seen in a
Reuters poll of analysts. 
    For more on the company, double click 
    
    GETINGE 
    Medical technology group Getinge is due to publish its
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crowns ($149.5 million), according to a Reuters poll of analysts.
    For the full poll, double click 
    For more on the company, double click 
    
    AIR LIQUIDE 
    The specialty chemicals group said it had acquired two Polish companies,
Help! and Ventamed, which specialise in home oxygen treatments in Poland. No
financial details were given. 
    
    JCDECAUX 
    The group said it was awarded an exclusive 10-year contract to operate
outdoor advertising within three airports in Abu Dhabi, without giving financial
details. 
    
    HEINEKEN 
    The Dutch brewer will divest its Finnish Hartwall business to Danish
beverages group Royal Unibrew, the company said on Thursday.
 
    
    SAIPEM 
    A court may rule on company's corruption probe in Nigeria on Thursday.
    
    EADS 
    South Korea is set to decide next week whether to proceed with an auction on
supplying 60 next generation fighter jets worth 8.3 trillion won ($7.31 billion)
after rounds of failed bidding, a defence official said on Thursday.