LONDON (ShareCast) - -Strong data from US and China
-Stoxx Europe 600 posts best yearly start since 1998
-Yields on Italian and Spanish bonds drop below 5%
-Rehn expects high participation in Greek bond swap

FTSE-100: 1.02%
Euro Stoxx 50: 1.45%
Dax-30: 1.25%
SMI: 0.3%
Ibex 35: 0.97%

Is this what a recovery looks like?

France and Spain managed to shift a total of €12.5bn euros in debt while the interest rate on Spanish and Italian 10 year bonds dipped below 5% for the first time since August.

The easing of the sovereign debt market appears to endorse the European Central Bank’s move yesterday to loan out €529.5bn. The betting is that much of that liquidity will be going straight into the coffers of the under-pressure European states.

The drop in bond yields has been mirrored by a rise in the Stoxx Europe 600, which had gained 0.9% by the close after posting the biggest January to February climbs since the halcyon days of 1998.

China’s closely watched purchasing manager’s index came in at its highest level since September. It was a similar story in the US where the Institute of Supply Management’s factory index rose to 54.5, its highest reading in eight months.

Ollie Rehn, the EU Commissioner for Economic and Financial Affairs said he expects there to be high participation in the Greek bond swap that forms an important part of the bailout package.

EQUITIES

Veolia Environment rose 15% by the close after saying it’s in talks to sell its transit unit Transdev.

Temp recruiter, Adecco, rose 8% after boosting its dividend by 64%.

The strongest sector on the Stoxx Europe 600 was Financial Services, which gained 1.95%, the biggest falling sector was Media, which fell 0.65%.

MACROECONOMY

Eurozone consumer prices accelerated to a 2.7% year-on-year pace in February (Consensus: 2.6%).

Eurozone unemployment rose to 10.7% in January (Consensus: 10.4%).

OTHER MARKETS

Front month Brent crude futures had risen by 1.26% to hit $124.2 per barrel by 16:49 in London

The euro/dollar dropped 0.05% by 18:07 in Frankfurt to $1.3319

bs

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE