June's AI-picked stock updates now live. See what's new in Tech Titans, up 28.5% year to date.Unlock Stocks

Portugal aid request lifts European shares

Published 04/07/2011, 04:51 AM
Updated 04/07/2011, 04:56 AM
ES35
-
BCP
-

* FTSEurofirst 300 index gains 0.2 percent

* Portugal bank stocks rise after Portugal seeks bailout

* For up-to-the-minute market news, click on

By Joanne Frearson

LONDON, April 7 (Reuters) - European shares rose on Thursday, led higher by financials after Portugal said it would seek financial aid, but traders were wary that the bailout may not signal the end of the euro zone debt crisis.

Portugal is the third euro zone country to seek a bailout, and investors are now watching to see if Spain could be next, though Spanish Economy Minister Elena Salgado told national radio that was not an option.

By 0834 GMT the pan-European FTSEurofirst 300 index of top shares was up 0.2 percent at 1,149.75 points ahead of an interest rate decision by the European Central Bank.

"Portugal was so much expected," said Lothar Mentel, chief investment officer at Octopus Investments, which manages 2.5 billion sterling ($4.1 billion). "Now there is more focus on Spain; the pressure is not really going to go away."

Mentel also said he expected there to be a shift towards value stocks from growth in the next half of the year if the global economy slows.

Banking stocks featured among the best performers, with the STOXX Europe 600 Banks index gaining 1.2 percent.

Portugal's Millennium bcp, Banco Espirito Santo and BPI gained 3.7 to 4.6 percent on the aid request, outperforming Portugal's PSI 20, which was 1 percent higher.

Spain's IBEX 35, however, was down 0.2 percent.

"We've seen some selling in Spanish banks," said a head of sales trading at a European investment bank. "Attention has just switched to the state of the property market in Spain, the amount of writedowns the banks need to take, and that they're not out of the water yet." (Reporting by Joanne Frearson; Editing by Will Waterman) ($1=.6137 Sterling)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.