Stocks at one-month high as ECB move sparks rally

Eurostoxx 50: 2,844.51 (+11.88) Frankfurt DAX: 7,471.44 (+40.25) Paris CAC: 3,979.96 (+18.62)EUROPEAN STOCKS advanced yesterday to a one-month high after the European Central Bank suspended collateral rules to ease Portugal's access to emergency funds.

The Stoxx Europe 600 Index rose 0.5 per cent in London as ECB president Jean-Claude Trichet suspended the minimum credit-rating threshold for Portugal’s debt in refinancing operations.

“The current big news stories are euro debt and US jobs, and today there was positive news for both,” said Daniel Weston, a Munich-based portfolio adviser at Schroeder Equities.

“US jobs data looks to be improving, and Trichet has declared further support for Portugal by suspending collateral rules and debt-rating requirements,” he said.

Trichet said the ECB will suspend its minimum credit-rating threshold on Portuguese bonds after Moody’s Investors Service lowered the country’s debt to junk.

Man rose 3.8 per cent to 256.3p after saying funds under management rose to $71 billion in the three months through June.

Deutsche Boerse climbed 2.5 per cent to €54.56, a one-month high.

ASML, Europe’s biggest semiconductor-gear maker, gained 3.8 per cent to €26.74, while Solvay, the world’s largest soda-ash maker, rose 2.5 per cent to €111.

Bayerische Motoren Werke, a maker of luxury cars, added 1.8 per cent to €69.07 after saying deliveries rose 16 per cent in June to 165,855 cars and sport-utility vehicles.

BHP Billiton and Rio Tinto, the world’s largest mining companies, rose 2.1 per cent to 2,523p and 2.5 per cent to 4,606p, respectively.

Distribuidora Internacional de Alimentacion, the world’s third-largest discounter, surged 12 per cent to €3.65.

ThyssenKrupp fell 5.3 per cent to €32.9 as the Germany-based company sold 9.6 per cent of its capital stock for €32.95 a share.

Hammerson slumped 4.4 per cent to 465.6p, the biggest decline in more than a year.

Premier Farnell plunged 21 per cent to 193.8p, the biggest drop since at least 1988, after the UK supplier of electronic components said May and June sales missed targets. – (Bloomberg)