The European markets gained ground on German Chancellor Angela Merkel's comments on Thursday. Merkel stated that Germany is committed to do everything it can to maintain the euro, which helped keep alive hopes that the ECB will take some decisive steps to reduce surging borrowing costs. The unexpected increase in U.S. consumer confidence provided further support to the markets in the afternoon.
Finland is preparing measures to face any kind of eventuality in the face of a breakup of the euro currency-bloc, the country's Foreign Minister Erkki Tuomioja told the British newspaper The Daily Telegraph.
"We have to face openly the possibility of a euro-break up," Tuomioja was quoted as saying on Thursday. "Our officials, like everybody else and like every general staff, have some sort of operational plan for any eventuality," he told the daily.
The European Commission wants the European Central Bank to act as the supervisor for all major banks in the euro area, German business daily Handelsblatt reported Friday.
The Commission is expected to put forward a proposal in this regard in September. According to the plan, the respective national authorities will be supervising the day-to-day activities of the banks and the ECB will intervene whenever there is a "dangerous risk."
Spanish banks' bad loans reached the highest on record in June, the Bank of Spain reported Friday. Bad loans rose to 9.42 percent of total lending in June, compared to 8.95 percent in May. Non-performing loans increased EUR 8.4 billion in June, to EUR 164.4 billion.
The Euro Stoxx 50 index of Eurozone bluechip stocks increased by 0.49 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.24 percent.
The DAX of Germany climbed by 0.64 percent and the CAC 40 of France gained 0.23 percent. The FTSE 100 of the U.K. rose by 0.28 percent and the SMI of Switzerland finished up by 0.17 percent.
In Frankfurt, Commerzbank increased by 3.27 percent and Deutsche Bank gained 3.70 percent.
In Paris, Credit Agricole rose by 3.33 percent. Societe Generale added 2.63 percent and BNP Paribas climbed by 1.51 percent.
In London, Vodafone rose by 0.22 percent. The U.S Department of Justice cleared the $3.9 billion deal by Verizon Wireless, a joint venture of Verizon Communications and Vodafone Plc., to buy spectrum from cable operators including Comcast Corp.
Rio Tinto fell by 0.39 percent, after the miner priced $3.0 billion of fixed rate bonds with a weighted average coupon of 2.67 percent and a weighted average maturity of 12.9 years.
Shares of Lonmin ended the session lower by 1.31 percent, after reports of a deadly clash between police and striking workers at a platinum mine in South Africa.
GlaxoSmithKline decreased by 0.84 percent, after the announced shutdown of a factory in western India.
Barclays rose by 3.73 percent and HSBC gained 0.92 percent. Lloyds Banking Group increased by 3.74 percent and Royal Bank of Scotland added 1.89 percent.
Swiss Life Holding climbed by 3.05 percent in Zurich, even though the company reported a decline in its 2012 first-half net profit.
Eurozone current account surplus increased in June, data published by the European Central Bank showed Friday. The seasonally adjusted current account surplus rose to EUR 12.7 billion in June from EUR 10.3 billion in May and EUR 5.5 billion in April.
Eurozone's foreign trade surplus increased in June, the latest figures published by Eurostat showed Friday. The trade surplus rose to EUR 14.9 billion in June from EUR 7.1 billion in May. A year ago, the balance was in a surplus of EUR 0.2 billion.
German producer price inflation eased to its lowest level in more than two years in July amid a fall in production costs for electricity and intermediate goods, a report from the Federal Statistical Office showed Friday. Pipeline inflation eased to 0.9 percent from 1.6 percent in June. Economists had expected the rate to ease to 1.2 percent in July. The figure slowed for the fourth month in a row.
A leading indicator of the French economy decreased for the third consecutive month in June, hurt primarily by negative assessment of the employment situation and industrial new orders, data released by the Conference Board showed Friday. The leading economic index declined 0.3 percent sequentially to 113 in June, after falling by 0.2 percent each in the previous two months.
U.S. consumer confidence unexpectedly improved in August following increased jitters earlier this summer. The Thomson Reuters/University of Michigan preliminary August index of consumer sentiment increased to 73.6, from 72.3 the prior month. This was the highest level since May, defying market expectations for a reading of 72.2.
by RTT Staff Writer
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