Financial Stocks Lead Euro Markets Higher
European equity markets closed higher Thursday, with financial stocks making firm gains after the central banks of England and Switzerland injected funds into the credit markets to boost liquidity.
The European Central Bank backed up the move by saying it would add to the liquidity pool if more was needed. Banking was one of the best performing sectors after the news, rising 1.5 percent.
"The market is still very, very jittery but I think it wants to believe that the central banks can solve the problem," Andrew Lynch, a portfolio manager at Schroders, said.
In corporate news, German investment bank Hypo Real Estate said it does not require a capital increase but warned that further serious turmoil in the international markets could affect its 2008 pretax profit goal and that further writedowns could follow. Shares surged 14 percent, despite a fall at the open.
Swiss Life promised a bumper payout for investors as the insurer reported a better-than-expected 43 percent jump in full-year net profit. Shares of Swiss Life gained 7.9 percent.
In Sweden, H&M's shares closed 7.8 percent higher after net profit for its first quarter, which ended in February, came in ahead of analysts' forecasts, thanks to a strong pickup in sales over last month.
UK DIY retailer Kingfisher slashed its dividend by 30 percent after it reported full-year earnings in line with expectations. It also vowed to restructure its underperforming Chinese B&Q unit. Shares fell 3.5 percent.
Also in the UK, the world's biggest listed hedge fund Man Group sounded a bullish note by saying it will beat analysts' forecasts for profit for the full year ending on March 31, sending its shares higher by 2.7 percent.
And finally, the second day of French President Nicolas Sarkozy's state visit to the UK saw him meet with Prime Minister Gordon Brown. The two leaders called for greater transparency in the financial markets.
- Reuters contributed to this report.