European Factors to Watch-Fed to buoy shares, tracking new Wall St high

Thu Jun 19, 2014 2:36am EDT

EDINBURGH, June 19 (Reuters) - European stocks were seen opening higher on
Thursday, tracking gains in U.S. and Asian shares after the Federal Reserve said
the economy was making progress and committed to retaining accommodative
monetary policy over the long term.        
     At 0633 GMT, futures for the Euro STOXX 50, Britain's FTSE 100
, Germany's DAX and France's CAC were 0.6-1 percent
higher.
    Asian shares followed Wall Street higher, with the S&P 500 ending at
a record high on Wednesday after the Fed hinted at a slightly faster pace of
interest-rate increases starting next year but suggested rates in the long run
would be lower than it had indicated previously. 
    "The boards have lit up in Asia today after the Fed delivered a dovish tone,
while the market seemed to have been positioned for a slightly more hawkish
tone," Stan Shamu, market analyst at IG, said in a trading note. 
    "This saw U.S. equities extend gains to fresh record levels and this has
also resonated through to Asian markets ... Looking ahead to European trade, the
positive sentiment is set to continue."
    On Wednesday, the pan-European FTSEurofirst 300 index ended flat at
1,387.44 but remained within touching distance of a 6-1/2 year high of 1,398.65
reached last week, as violence in Iraq pushed up the price of oil and lifted
shares of major oil companies. 
    Brent crude held near a nine-month high above $114 a barrel on Thursday,
poised for a third day of gains following a rise of more than 4 percent last
week on supply concerns after Islamic militants seized much of northern Iraq.
  
    However, persistently high oil prices can hurt economic growth and also
stock market returns.
    "People will watch the oil price, and every $10 dollar rise in oil knocks 25
to 32 basis points of U.S. GDP, according to the OECD," Ioan Smith, director at
KCG, said. 
    "It's something (Fed Chair) Yellen said they were monitoring, as it's so
important for financial stability."
    
    Europe bourses in 2014: (link.reuters.com/pad95v)
    Asset performance in 2014: (link.reuters.com/rav46v)
------------------------------------------------------------------------------
  MARKET SNAPSHOT AT 0632 GMT: 
    
                                         LAST  PCT CHG    NET CHG
 S&P 500                             1,956.98   0.77 %      14.99
 NIKKEI                              15361.16   1.62 %     245.36
 MSCI ASIA EX-JP                       491.19   0.71 %       3.47
 EUR/USD                               1.3616   0.15 %     0.0021
 USD/JPY                               101.78  -0.13 %    -0.1300
 10-YR US TSY YLD                       2.581       --      -0.03
 10-YR BUND YLD                         1.349       --      -0.03
 SPOT GOLD                          $1,278.45   0.07 %      $0.95
 US CRUDE                             $106.54   0.54 %       0.57
 
  > Fed optimism lift Asia stocks, dollar struggles            
  > US STOCKS-Wall St gains on Fed's view; S&P 500 ends at record    
  > Nikkei jumps to 4-1/2-month high on Fed optimism            
  > TREASURIES-Prices gain as Fed more dovish than expected        
  > FOREX-Dollar slips as Fed fails to live up to hawkish billing    
  > PRECIOUS-Gold holds gains as dollar drops after Fed        
  > METALS-London copper slips on niggling demand doubts        
  > Brent above $114 near 9-month high on Iraq turmoil        
    
    COMPANY NEWS:    
    BNP PARIBAS 
    Latest negotiations between U.S. authorities and BNP Paribas on the level of
fine it could pay for breaching U.S. sanctions have failed to produce an
agreement, sources said. 
    
    L'OREAL 
    French cosmetics giant L'Oreal said on Wednesday the U.S. market for mass
beauty consumer goods remained flat, dashing hopes of an improvement this
quarter, but pointed to continued recovery in Europe, notably in southern
countries. 
    Separately L'Oreal said it had agreed to buy Los Angeles-based NYX Cosmetics
as it builds up its stable of U.S. brands. 
    
    ALLIANZ 
    Institutional investors including BlackRock and Allianz's Pimco on
Wednesday sued six of the largest bond trustees, accusing them of failing to
properly oversee more than $2 trillion in mortgage-backed securities issued in
the run-up to the 2008 financial crisis. 
    Related news 
    
    BMW 
    BMW said it plans to save several hundred million euros in annual costs to
offset higher expenses for investments to meet tougher emissions standards and
develop new electric and hybrid cars. 
    Related news 
    
    
    UBS, CREDIT SUISSE 
    The Swiss National Bank on Thursday welcomed the "significant progress" made
by UBS and Credit Suisse at improving their capital, but urged Switzerland's two
largest banks to improve their leverage ratios.
    For more, click on:  
    
    CREDIT SUISSE
    Norway's central bank Norges Bank has increased its holding in Credit Suisse
to 5.01 percent, according to a disclosure to the Swiss stock exchange.
    For more, click on: 

 (Reporting by Alistair Smout; Editing by Prateek Chatterjee, Anand Basu and
Sudip Kar-Gupta)
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