European Stocks Rise, Wall Street stumbled
The market-European main stock markets rose supported by the positive results of U.S. companies, which decreased at the end of Wednesday, when Wall Street lower as investors wait for new signals about the prospects of U.S. Fed chief. European trading before the release of the results also tentatively endurance test (stress tests) to 91 European banks on Friday, determined their financial soundness.
While the ministers in several European countries have voiced their belief that banks would pass, analysts warn that some lenders can be found under capitalization and vulnerable to new economic upheavals. “The trend is still very fragile and dependent on Wall Street,” said analyst Yves Marcais of Global Equities. In London, the London FTSE 100 index added 1.46 percent to 5214.64 points while in Paris the CAC 40 rose 0.75 percent to 3493.92 points. In Frankfurt the DAX shed 0.38 percent to 5990.38 earn points.
In other places there are gains 0.76 percent in Milan, 0.15 percent on the Swiss Market Index and 1.84 percent in Amsterdam. Madrid fell 0.20 percent. U.S. stocks traded lower on Wednesday. Shares of blue-chip Dow Jones Industrial Average fell 0.18 percent at 10211.04 in mid-day, with the Nasdaq composite slid 0.67 percent to 2207.70 points. Investors initially supported by a second-quarter profits very well by Apple and revenue better than expected by leading banks Morgan Stanley and Wells Fargo as well as soft drinks giant Coca Cola on Wednesday.
But optimism evaporated early sentiment ahead of the testimony of Federal Reserve Chairman Ben Bernanke at the Senate on Wednesday. “We expect him to repeat the Fed’s policy statement recently that the Fed saw the economy slowly recovered and intend to maintain the policy interest rate today for an extended period of time,” said Frederic Dickson, chief market strategist of DA Davidson & Co. “We hope she be grilled on the Fed’s most recent forecast for economic growth in 2010 and 2011 and that the unemployment rate will remain high,” he said.
IG Index analyst Anthony Grech spoke of a “sense of excitement on the floor of the main market trading today ahead of testimony from Ben Bernanke.” “Speculation is mounting that the Fed chairman is ready to tell the Senate … that the Fed is willing to act to assist the economic recovery (More).” In Asian trading Wednesday, shares of China and a rebound on Wall Street Tuesday in most Asian markets gave a lift on Wednesday. Hong Kong, rose 1.10 percent and Shanghai rose 0.26 percent to end at highest in three weeks. On the decline, Tokyo lost 0.23 percent amid continued worries about the U.S. economy and global economy.