European stock markets rose to the highest level in almost a month on Tuesday, after euro-zone finance ministers agreed on aid disbursement for Greece and better-than-expected results from Alcoa Inc. sparked cautious optimism about earnings.
Markets, however, trimmed gains in afternoon action after the International Monetary Fund slashed its global growth forecast.
The Stoxx Europe 600 index climbed 0.8% to close at 294.58, its second straight day in positive territory.
On Tuesday, investors welcomed an agreement from euro-zone
finance ministers to disburse 3 billion euros ($3.86 billion) in aid to
Greece on condition the country meets the goals laid out under the
second international bailout.
The Athex Composite index , however, dropped 2.3% to
838.29. The Bank of Greece in late May forecast a 4.6% contraction this
year.
In the same vein, the International Monetary Fund trimmed
its estimate on global growth to 3.1% this year, down from its 3.3%
forecast in April. For the 2014, the fund sees global growth of 3.8%,
also down 0.2% from the previous estimate.
More specifically, the IMF slashed its growth projection
for Spain in 2014 to 0%, down from an earlier estimate of 0.7%
expansion. The IBEX 35 index closed slightly lower at 8,014.80.
Among country-specific indexes in Europe, the U.K.’s FTSE 100
index climbed 1% to 6,513.08 as mining firms tracked most metals
prices higher. Shares of Rio Tinto PLC gained 2.5% and Anglo American
PLC rose 3%.
Germany’s DAX 30 index added 1.1% to 8,057.75. Siemens rose 0.9% after Deutsche Bank lifted the industrial conglomerate to hold from sell.
France’s CAC 40 index gained 0.5% to 3,843.56.
Shares of Electricité de France SA jumped 9.3% after UBS
lifted the firm to neutral from sell, citing the outlook for higher
tariffs and a nuclear-power life extension as positive catalysts. The
French government late Monday allowed EDF to raise electricity prices
for residential consumers by 5% next month.
Shares of Osram Licht AG jumped 17% as HSBC initiated coverage of the firm with an overweight rating.
Shares of LVMH Moët Hennessy Louis Vuitton gained 2.1% after the
luxury-goods firm said late Monday it has agreed to buy a majority stake
in Italian cashmere brand Loro Piana.
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