Europe stocks higher on China yuan move; DAX rises 1.53%
Investing.com
Published Jun 21, 2010 07:38AM ET
During European late morning trade, the EURO STOXX 50 was up 1.75%; France’s CAC 40 rose 1.71%; and Germany's DAX was up 1.53%.
The People’s Bank of China said on Saturday that it would allow the yuan to trade in a 0.5% daily trading band against the U.S dollar and added that greater yuan flexibility would help reduce China’s trade surplus as well removing over-reliance on exports to power growth.
The move signaled the bank’s increased optimism with regard to China’s economic growth and the global economic recovery.
In London, the FTSE 100 was up 1.13%, as BP shares slid 3.6% after the company announced the cost of the Gulf of Mexico clean-up had risen to USD 2 billion and amid reports that the company is attempting to raise USD 50 billion through asset sales and borrowing.
The outlook for U.S. equity markets, meanwhile, was rosy: Dow Jones Industrial Average futures indicated an increase of 1.17%, S&P 500 futures pointed to a rise of 1.33% and Nasdaq 100 futures indicated a gain of 1.41%.
Later in the day, the president of the European Central Bank, Jean-Claude Trichet was due to testify before the European Parliament in Brussels. Traders were likely scrutinizing his comments for clues to future shifts in monetary policy.
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