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European Commentary

European Stocks Could Trade Up On Greek Hopes

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2/20/2012 2:06 AM ET
(RTTNews) - European stocks are poised to open higher, as indicated by the major index futures of the region, which are trading in the green. Most Asian markets ended higher, with a decision by China to lower bank reserve requirements and the strengthening Greek hopes lending support. The Eurogroup is set to meet later today to give its verdict on the Greek bailout, while the U.S. market is closed on account of a public holiday.

Over the weekend, China lowered the reserve requirement of banks for the second time to boost lending. The reduction ensures the release of 400 billion yuan worth of capital into the market. helping to ease short-term credit crunch.

Last week, the major averages in Europe advanced solidly on positive vibes from Greece concerning an agreement that could facilitate the release of the bailout package. The Euro Stoxx 50 Index rose 1.15 percent for the week and the Europe Stoxx 50 gained a more modest 0.57 percent.

The French CAC 40 Index gained 1.97 percent compared to a 2.31 percent advance by the German DAX Index, while the FTSE 100 Index was up 0.90 percent.

On the economic front, French statistical office INSEE is set to release the results of its survey on business confidence for February. The business confidence indicator is expected to increase 1 point to 92, while the production outlook indicator is expected to improve to -36 from -37 in the previous month.

Italy is set to release a report on industrial orders for December, with economists forecasting a 0.4 percent increase in orders compared to the previous month. Annually, orders are forecast to fall -5.6 percent.

Earlier in the day, a survey by Rightmove showed that average asking prices for a property in the U.K. rose 4.1 percent month-over-month in February, the fastest monthly rate since April 2002.

In corporate news, brewer Carlsberg reported a decline in its 2011 adjusted operating profits to 9.8 billion Kroner, which was in line with estimates of most analysts. The company attributed the profit drop to rise in raw material costs and a weak performance in Russia.

Risk currencies are advancing, while commodities are also moving to the upside.

by RTT Staff Writer

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