adminthis evening on the Greek bond swap offer to private creditors, and also ahead of today’s keenly-watched US jobs report.
“This has been the game of anticipation. I think it’s likely to remain volatile but overall . . . we would be expecting more upside potential moving into next week,” Luca Solca, global head of European research at CA Cheuvreux, said.
“I think the rally would take shape expanding into higher beta names, we have been expanding into stocks like Commerzbank.”
Commerzbank, whose beta of 1,8 suggests it is 80 percent more volatile than the broader market, added 2,3 percent.
The banking sector as a whole, whose sovereign debt holdings make it highly sensitive to the fresh twists and turns of the Greek debt saga, added 2 percent.
The Euro STOXX 50 index of euro zone blue chips rose 1 percent to 2 469,34 points, extending gains partly on speculation that China could loosen monetary policy to stimulate economic growth. After finding support at the 50-day moving average around 2 444 on Wednesday, the Euro STOXX 50 still has around 50 points to climb to reverse a steep sell-off seen on Tuesday. According to technical analysts at Day By Day, the index remains in a correction phase from this year’s rally — which has taken it up 8,7 percent in 2-1/2 months — between 2 398 and 2 495 points.
For some, though, the more upbeat market mood is a reason to start selling.
BNP Paribas’ European Love-Panic indicator, designed to track price action attributed to investor sentiment rather than fundamentals, has moved into convincingly positive territory, which the bank interprets as a signal to buy protection against possible weakness.
It recommends a September 2012 options trade known as a “put ladder” on the Euro STOXX 50 at 2 540, 2 200 and 1 950 for a 1,9 percent premium. The broader FTSE Eurofirst 300 added 1,2 percent to 1 063 87.
Among individual stocks, companies with global exposure performed strongly, while those relying on domestic consumers suffered as high unemployment led people to tighten their belts, hurting profits. Belgian supermarket group Delhaize and German consumer goods group Henkel fell after posting weaker than expected results. — AFP.
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