The European markets are rising on Friday, on speculation that central banks are prepared to inject cash in the event of an escalation in turmoil in the region after the elections in Greece on Sunday.
The fear is that if the leftist Syriza party led by Alexis Tsipras comes to power in Greece, the austerity measures that were tied to the bailout package for the debt-ridden nation may not take effect.
Bank of England Governor Mervyn King has said that the case for more stimulus is increasing amid deterioration in the economic outlook. "With signs of a deterioration in the outlook, especially in world markets, the case for a further monetary easing is growing," he said in a speech at the Mansion House on Thursday.
European Central Bank President Mario Draghi said on Friday that inflation expectations remain well anchored and there is no inflation risk in any euro area country. Political choices are dominating the monetary policy, Draghi said.
"Should risks to price stability emerge, the Eurosystem has sufficient tools at its disposal to absorb excess liquidity," Draghi said in a speech at the 14th ECB Watchers Conference in Frankfurt.
The Euro Stoxx 50 index of eurozone bluechip stocks is adding 1.58 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is rising 0.77 percent.
The German DAX is adding 1.1 percent and the French CAC 40 is gaining 1.67 percent. The UK's FTSE 100 is rising 0.54 percent and Switzerland's SMI is adding 0.17 percent.
In Frankfurt, ThyssenKrupp is climbing 4.1 percent, thus leading the gainers. Insurer Allianz is rising 2.7 percent.
Commerzbank is gaining 2.6 percent and Deutsche Bank is advancing 1.9 percent.
Daimler and Volkswagen are gaining 2.1 percent and 1.8 percent, respectively. BMW is flat.
HeidelbergCement is climbing 1 percent. Deutsche Bank cut its price target on the stock.
Fresenius and Fresenius Medical Care are notably lower.
On the CAC 40 index, steel giant ArcelorMittal is climbing 4.2 percent. Credit Agricole, Societe Generale and BNP Paribas are advancing between 4.1 percent and 2.5 percent.
Carrefour is rising 3.2 percent. The supermarket chain has decided to sell its ownership in the Carrefour Marinopoulos joint venture in Greece to Marinopoulos Group.
Peugeot is gaining 1.1 percent while Renault is adding 0.6 percent.
In London, Anglo American and Antofagasta are advancing 2 percent and 1.8 percent, respectively. Eurasian Natural Resources is advancing 3.1 percent and Vedanta is climbing 4.9 percent.
Randgold Resources is gaining 2.5 percent reportedly on a broker upgrade.
Among lenders, Lloyds Banking is gaining 3 percent and Royal Bank of Scotland is surging 6.4 percent.
Albemarle & Bond Holdings is falling over 9 percent, after the pawnshops operator said it now sees full-year profitability to increase below current market consensus.
Aggreko is losing 4.3 percent. The temporary power provider said in a trading update that it expects to deliver a strong performance for the first half of the year. However, margins in International Power Projects are expected to be lower in the second half compared to last year, owing mainly to higher mobilization costs.
Telekom Austria is up 2.3 percent in Vienna after América Móvil decided to buy a 21 percent stake in the firm.
Hennes & Mauritz is up 1.5 percent in Stockholm. The company reported growth in sales for May.
Nokia is up 3.1 percent in Helsinki. Citigroup raised the stock to "Neutral" from "Sell," while Credit Suisse lowered it to "Neutral" from "Outperform."
Across Asia/Pacific, major markets ended higher. Australia's All Ordinaries added 0.4 percent, China's Shanghai Composite Index rose 0.5 percent and Hong Kong's Hang Seng climbed 2.3 percent. Japan's Nikkei 225 ended nearly flat.
In the U.S., futures point to a higher open on Wall Street. In the previous session, the markets managed to end the day on the upside amid optimism about the likelihood of further stimulus. The Dow jumped 1.2 percent, the Nasdaq rose 0.6 percent and the S&P 500 climbed 1.1 percent.
In the commodity space, crude for July delivery is adding $0.56 to $84.47 per barrel and August gold is rising $6.1 to $1625.7 a troy ounce.
by RTT Staff Writer
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