Barclays leads the FTSE higher
Compared to yesterday, European Markets calmed down on Friday morning, swaying between negative and positive territory before making a confident move higher throughout the afternoon.
The news started with some bad updates from Spain, reporting that the Spanish unemployment, already the highest in the European Union, rose again from 24.4% to 24.6% in the second quarter of the year. Although the figure was better than forecast it was still the worst level since records began in 1976. According to the Bank of Spain, recession also deepened in the second period and it will intensify its efforts to reduce its budget deficit, which is almost comparable with that of Greece’s.
On the Brightside, the FTSE 100 was sent up by some good earnings results from Barclays PLC (LN: BARC), beating analysts forecast and posted a profit of more than £4bn despite the reputational damage inflicted from its role in the interest rate-rigging (LIBOR) scandal. Barclay’s shares finished 30.4 pence up (8.7%) to 167 pence.
The German Consumer Price Index, which measures the inflation rate, showed a monthly rise of 0.4% (from -0.1%). The result was in line with forecasts of a Reuter’s poll, made of 36 economists’ opinion. On a yearly base whereas Inflation rate in Europe’s biggest economy remained steady at 1.7% in July, close but just under the 2 % price stability target set by the European Central Bank in the euro-zone as a whole. This possibly offers good news for Europe as sub-target inflation increases the scope for central bank easing amid a traditionally hawkish German influence.
Momentum for today’s gains came from the U.S which released its GDP results at around midday European time, reporting an economic growth of 1.5% over the second quarter (at an annual rate). This was ahead of analysts’ expectations, however still represents sluggish growth in the world’s largest economy. Also the consumer confidence shrank to its lowest level this year and fell from 73.2 in June to 72.3 this month.
The FTSE 100 closed up 1 % at 5627 underperformed other European Indices with the CAC40 up 2.3%, the German DAX 1.6% and the Spanish Ibex nearly 4% higher.
This was posted in Bdaily's Members' News section by James .