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19/01/2012 12:00 - Bond auctions by France and Spain lead to a positive performance in Europe

On Thursday European stocks gained for a fourth day, extending a five-month high for the Stoxx Europe 600 Index, as Spain and France sold bonds at lower yields. Asian shares advanced, while U.S. index futures fluctuated.


The Stoxx 600 gained 0.3 percent to 254.17 at 10:48 a.m. in London as two stocks rose for every one that fell. The gauge has advanced 3.9 percent in 2012, the best start to a year since 2004, as reports around the world added to optimism that the economy is strengthening. Greece’s government heads into a second day of talks with private creditors during the day in a push to reach an accord that would slash the nation’s debt.


Greek Prime Minister Lucas Papademos is racing to tie up the accord, key to a second financing package for the cash- strapped country, before a March 20 bond payment that will cost 14.5 billion euros Greece doesn’t have.


France auctioned 7.965 billion euros of two-, three- and four-year notes in its first sale of medium- and long-term debt after losing its AAA rating at S&P last week. Yields fell on all maturities.


Spain sold 6.61 billion euros of bonds maturing in 2016, 2019 and 2022, compared with a maximum target for the sale of 4.5 billion euros. The yield on the 2022 debt fell to 5.403 percent from 6.975 percent when the securities were auctioned in November. The 2019 yields also declined, while the 2016 borrowing costs increased.


Asian stocks rose, spurring a record start to the year for the regional benchmark index, amid signs China will relax credit controls and after confidence among U.S. homebuilders beat estimates.  Japan’s Nikkei 225 Stock Average rose 1 percent.


This article was compiled by Valletta Fund Management Limited, a member of the BOV Group. Valletta Fund Management, TG Complex, Suite 2, Level 3, Brewery Str., Mriehel BKR 3000.  Freephone: 80072344. email: Internet address: Valletta Fund Management Limited is licensed by the MFSA.