RTTNews - The European markets rose for the first time in three days on Wednesday after a government report showed U.S. durable goods orders unexpectedly increased last month and the Organization for Economic Cooperation and Development boosted economic outlook for its 30 member countries.
The U.S. Commerce Department said in its report that durable goods orders rose 1.8% in May, matching the revised increase seen in April. The continued increase came as a surprise to economists, who expected orders to fall 0.9% compared to the 1.9% increase originally reported for the previous month.
However, a separate report from the U.S. Commerce Department showed that new home sales edged down 0.6% to an annual rate of 342,000 in May from a revised April rate of 344,000. Economists had expected sales to jump 2.3% to 360,000 from the 352,000 originally reported for the previous month.
The OECD raised its economic outlook for its 30 member nations for the first time in two years. The 30-member area is forecast to see an economic contraction of 4.1% in 2009, revised from a 4.3% contraction estimated in March.
Crude for August delivery fell $0.52 to $68.72 a barrel on the New York Mercantile Exchange, by the time the European markets closed, after the U.S. government reported that unused gasoline in storage has grown by millions of barrels.
Investors are waiting for the U.S. Federal Reserve's interest rate decisions due later today. While there is little doubt that the policymaking arm of the Fed will keep its interest rate target unchanged, observers will pay close attention to the accompanying statement for any indication that the Federal Open Market Committee is revising its inflation outlook.
The FTSEurofirst 300 index of pan-European blue chips closed 2.39% higher at 853.56 points, while the narrower DJ Stoxx 50 index rose 2.23% to 2,118.57 points.
Around Europe, the U.K.'s FTSE 100 index rose 1.18% to 4,279.98, while France's CAC 40 index surged up 2.18% to 3,184.76 and Germany's DAX index climbed 2.74% to 4,836.01.
Banking stocks were among top gainers. HSBC, Europe's largest bank, rose 1%, while BNP Paribas, France's largest bank, surged up 4.5% and Deutsche Bank, Germany's biggest lender, climbed 6.6%. UBS, Switzerland's largest bank, gained 5.5%.
Mining stocks climbed after metals prices advanced. BHP Billiton, the world's biggest miner, surged up 4.6%, while Anglo American, the second biggest, jumped 10.2% and Rio Tinto, the third biggest, rose 4%. Xstrata, the world's fourth biggest copper miner, gained 2.8%.
Technology stocks edged higher after Oracle reported better than expected fourth quarter earnings. SAP, the world's biggest maker of business management software, surged up 3.2%, while STMicroelectronics, Europe's biggest chipmaker, rose 2.5% and Infineon, the second biggest, climbed 6%.
For comments and feedback: contact email@example.com