European stocks extend gains on Vestas deal

Eurostoxx 50:2,875.67 (+27.14) Frankfurt DAX:7,419.44 (+43.20) Paris CAC:4,007.35 (+25.14)

EUROPEAN STOCKS advanced for a fifth day yesterday, pushing the benchmark Stoxx Europe 600 Index to the biggest weekly rally in a year, as US manufacturing growth exceeded economists’ forecasts.

The Stoxx 600 advanced 0.8 per cent to 274.92 in London.

The measure has soared 4.1 per cent this week, the most since July last year, as parliament supported Greek prime minister George Papandreou’s €78 billion austerity package in order to obtain further European Union financial assistance.

“The US manufacturing report has beaten the consensus, giving a positive signal to the market on the health of the US economy,” said John Plassard, director at Geneva-based Louis Capital Markets.

“We may also have seen fund managers buying back stock to cover short positions now some concerns have eased over the Greek debt situation,” he said.

EU finance chiefs are holding a conference call today to free up a €12 billion tranche from last year’s €110 billion bailout.

Vestas jumped 7.1 per cent to 128 kroner after saying EDF Energies Nouvelles, a French renewable energy developer, may buy as much as 2,000MW of turbines under an agreement that covers deliveries from 2012 to 2014.

Commerzbank rallied 5.8 per cent to €3.14 for the biggest gain in the DAX.

Lloyds Banking, Britain’s largest mortgage lender, climbed 3.9 per cent to 50.92p after UniCredit upgraded the bank.

Greek banks gained as three of the country’s biggest lenders jumped more than 5 per cent.

EFG Eurobank Ergasias soared 4.6 per cent to €3.29, Alpha Bank rose 5.2 per cent to €3.65 and National Bank of Greece climbed 5.5 per cent to €5.20.

UBS, the biggest Swiss bank, increased 2.4 per cent to 15.70 francs after saying it plans to appoint former Bundesbank president Axel Weber as chairman.

CGGVeritas declined 1.2 per cent to €25.11 after Goldman Sachs downgraded the seismic surveyor of oilfields to “neutral” from “buy”.

ThyssenKrupp, Germany’s largest steelmaker, fell 1.6 per cent to €35.25 – (Bloomberg)