Swatch advance puts shine on European stocks

Eurostoxx 50:2,324.88 (+17.15) Frankfurt DAX:6,022.24 (+24.50) Paris CAC:3,239.06 (+25.18)

EUROPEAN STOCKS rose yesterday, extending the biggest three-day rally for the benchmark Stoxx Europe 600 Index in 15 months, after last week sliding to the cheapest valuation in more than two years.

Swatch Group paced gains among Swiss exporters as the Swiss franc headed for its largest three-day decline on record against the euro.

The Stoxx 600 rose 0.2 per cent to 237.85 in London after swinging between gains and losses at least 20 times yesterday.

The gauge has rallied 6.4 per cent over the past three days after a global equity rout left stocks trading at the cheapest since March 2009 amid concern the economic recovery is stalling.

Global markets are stabilising after a week of record swings in US stocks that was sparked by SP’s downgrade of its credit rating for the world’s largest economy. A report yesterday showed Japan’s gross domestic product shrank at an annualised 1.3 per cent rate in the three months ended June 30th.

Nokia, the world’s biggest maker of mobile phones by volume, jumped 9.1 per cent to €4.09 after Google agreed to buy Motorola Mobility, gaining wireless patents and entering the hardware business.

Swiss exporters advanced as the Swiss franc weakened against the euro, heading for its biggest three-day decline since the European currency’s 1999 debut.

Swatch, the world’s biggest watchmaker, added 3.1 per cent to 371 Swiss francs.

Financiere Richemont gained 2.4 per cent to 44.08 Swiss francs.

Zurich Financial Services rallied 3.6 per cent to 177.7 Swiss francs after both Credit Suisse and Keefe, Bruyette and Woods raised their recommendations for the Swiss insurer to “outperform”.

Aker rallied 12 per cent to 138 kroner while Fugro, the world’s largest surveyor of deepwater oil fields, jumped 5 per cent to €41.65.

Hochtief climbed 3.3 per cent to €49.60 after Australia’s Leighton Holdings reiterated it expected to swing to profit this year.

Michael Page plunged 8.1 per cent to 368p as the British recruiter said gross profit growth was slowing in the banking industry. It also reported a 26 per cent drop in first-half pretax profit. – (Bloomberg)