Stimulus hopes lift Europe; Barclays in focus
MADRID (MarketWatch) -- Expectations for a further round of stimulus from global central banks kept European markets in positive territory Tuesday, while surging commodity prices boosted related stocks and banks grabbed the spotlight as
The Stoxx Europe 600 index (SXXP) rose 1% to close at 257.39. Miners jumped, with
Andrew Taylor, strategist at GFT, said markets rose on hopes of action from global central banks, with downbeat U.S. manufacturing data on Monday driving speculation about a third round of quantitative easing from the Federal Reserve in four weeks' time.
Wall Street stocks gained in midday trade after factory-orders data rose 0.7% in May, topping expectations.
"Markets are factoring in a 25-basis-point rate cut from the European Central Bank, an increase in the Bank of England's bond-buying program and improved chances that the Fed will introduce QE3," Taylor said.
The ECB and Bank of England are both set to announce monetary policy decisions on Thursday. Ahead of that, volumes could thin out, with U.S. markets open a half-day Tuesday and closed Wednesday for the Fourth of July holiday.
Banks were in the limelight.
Shares of Barclays (BCS) (BARC) were volatile, initally gaining more than 2% on news of CEO Diamond's departure. But shares ended down 0.8% after Diamond's exit was followed by Chief Operating Officer Jerry del Missier, who had been seen as a potential successor.
Marcus Agius, whom the company said on Monday had stepped down as chairman, will retake that position and head up the hunt for a new CEO.
The turmoil comes after regulators fined the bank for attempted manipulation of benchmark interbank interest rates.
"Clearly there's a lot more to come from this story right across the sector, but that's a significant scalp to be taken at this stage and now leaves a looming succession issue for the bank," said Mike McCudden, head of derivatives at Interactive Investor, in a note.
The FTSE 100 index (UKX) rose 0.8% to 5,687.73, pulled higher by a 2% gain for
Iran worries drive crude higher
A standout gainer in Europe Tuesday was the Portugal PSI 20 index (PSI20) , which rallied 1.8% to 4,893.93, led by a 3.5% gain for fuel and oil group