European stocks seen continuing rebound
EUROPEAN OUTLOOK & US/ASIAN SUMMARIES:
Global stock markets are rallying Monday as investors are reassured by indications over the weekend that any contagion from Dubai World's debt crisis will be limited. European markets look set to tread higher again. U.S. stock futures are higher in screen trade after U.S. shares fell in a thinly traded and shortened session Friday.
STOCKS:
European bourses are expected to open up Monday, continuing Friday's recovery which saw investors pick up shares in banking and other shares that had fallen sharply the previous session on the Dubai debt news.
For Monday's opening, IG Markets is calling the FTSE up 16 at 5262, the DAX up 10 at 5696 and the CAC unchanged at 3721.
Asian markets have rebounded after the United Arab Emirates' central bank pledged support for the country's local and foreign banks, in turn easing fears of contagion.
The U.A.E. central bank said Sunday it is offering an additional liquidity facility to local and international banks in the U.A.E and stressed that it "stands behind" the lenders.
"What we are seeing today across Asia is equity markets realizing they over-reacted and that concerns of contagion were unfounded," said Ben Potter from IG Markets. "Tonight's full U.S. session will go along way to determining how we trade for the rest of the week. With liquidity and volumes dramatically increased, we'll get a much more accurate picture as to underlying investor sentiment."
"Recent data supports an upswing in European markets with leading indicators suggesting that the recovery is well under way," said Roger Guy and Guillaume Rambourg, managers of the Gartmore European Selected Opportunities Fund.
"Despite the recent consolidation, we believe that the positive story for equities is pretty much intact for the next three to six months, with equity inflows and yet more upgrades at the GDP and corporate earnings level."
Monday, data showed U.K. house prices rose for the fourth straight month in November as a low supply of suitable properties continues to push prices higher in some U.K. regions.
In other data, however, U.K. consumer confidence weakened in November for the first time since January as households counted the cost of the longest recession since records began in 1955. Polling firm GfK NOP said Monday the headline measure of consumer confidence fell to -17 from -13 in October. Confidence had improved significantly in the two previous months, rising from -25 in August.
In addition, a Confederation of British Industry survey of service sector firms in the U.K. reported an unexpected decline in both sales and profits in the three months to November, underlining the fragility of the economic recovery, as a lack of demand continued to be the key concern over the coming months.
Asian shares are higher as financial stocks rebounded in Australia, South Korea and Japan.
Japan's Nikkei 225 was up 3.0%, Australia's S&P/ASX 200 was up 2.7%, South Korea's Kospi Composite rose 2.7%. Hong Kong's Hang Seng Index added 3.4% and China's Shanghai Composite tacked on 2.5%. Bucking the trend, Singapore's Straits Times Index fell 0.9%, playing some catchup on the downside after being closed for a holiday Friday.
China's shares jumped after Beijing said late Friday it will maintain an active fiscal policy and moderately loose monetary policy next year, allaying investor concerns over a tightening policy bias. This "may indicate that Beijing wants to boost investor sentiment, especially amid continued uncertainty in the global economy," said Guosen Securities analyst Wang Junqing.
Dow Jones Industrial Average futures are up 53 points in screen trade after the DJIA closed down 1.48% at 10309.92 on Friday.
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November 30, 2009 01:00 ET (06:00 GMT)
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