European stock indices remain positive after ECB interest rate decision and German Factory Orders report .
The Major European stock indices climbed further into positive territory on Thursday after the European Central Bank kept its benchmark lending rate at 0.75 percent. The ECB interest rate decision and Germany’s huge jump in factory orders during October helped European stocks build on Wednesday’s modest gains. ECB President Mario Draghi reported that the Eurozone economy is expected to contract by 0.05 percent during 2012, compared with the anticipated contraction of 0.04 percent. Worse yet, the Eurozone’s economy is expected to contract by another 0.03 percent during 2013, despite an earlier outlook for expansion by 0.05 percent (NYSEARCA:VGK).
Destatis reported that Germany’s factory orders surged in October by 3.9 percent on a month-over-month basis, compared with expectations for a 1 percent advance. The move represented a recovery from September’s 3.3 percent decline (NYSEARCA:EWG).
Eurostat reported that during the third quarter of 2012, GDP contracted by 0.1 percent in the Eurozone, although GDP expanded by 0.1 percent in the broader, 27-nation European Union (EU27). On a year-over-year basis, Eurozone GDP declined by 0.6 percent and EU27 GDP contracted by 0.4 percent.
At its monthly meeting, the Bank of England determined to leave its interest rate unchanged and to maintain its asset-purchase program at £375 billion (NYSEARCA:EWU).
Former Italian Prime Minister Silvio Berlusconi was back causing trouble again, instead of going off to prison where he belongs. Berlusconi threatened to undermine the support Prime Minister Mario Monti had been receiving from Berlusconi’s People of Liberty party. Berlusconi’s antics caused Italy’s ten-year bond yield to spike and it sank the nation’s FTSE MIB Stock Index (NYSEARCA:EWI)
As of 11:15 EST, the Euro STOXX 50 Index advanced 0.50 percent to 2,605 – staying above its 50-day moving average of 2,512 (NYSEARCA:VGK). The FTSE 100 Index rose 0.27 percent to 5,907 (NYSEARCA:EWU). The German DAX Index jumped 1.10 percent to 7,536 (NYSEARCA:EWG). France’s CAC 40 Index climbed 0.42 percent to 3,605 (NYSEARCA:EWQ). Spain’s IBEX 35 Index advanced 0.28 percent to 7,905 (NYSEARCA:EWP). Italy’s FTSE MIB Index fell 0.76 percent to 15,833 (NYSEARCA:EWI). Israel ETF Continuing Run Despite Risks
As of 11:20 EST, the euro sank 0.77 percent against the dollar, trading at $1.2967 (NYSEARCA:FXE). Forget Europe, Traders Must Watch the U.S. Dollar
Spain’s ten-year bond yield rose to 5.47 percent on Thursday from Wednesday’s closing level of 5.40 percent. Spain’s two-year bond yield remained flat at Wednesday’s closing level of 2.97 percent on Thursday (NYSEARCA:EWP).
Italy’s ten-year bond yield jumped to 4.62 percent on Thursday from Wednesday’s closing level of 4.48 percent (NYSEARCA:EWI).