European stocks rebound after week of market turbulence

 

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The Independent Online

European stock markets rebounded on Friday after a fall in US unemployment applications and comments from a European Central Bank official eased nerves about a stalling economic recovery.

After sharp falls earlier this week, all major European stock markets entered positive territory in early trading.

France's CAC 40 rose 1.7 per cent and Germany's DAX jumped 1.6 per cent. Spain's IBEX 35 and Italy's FTSE MIB advanced more than 2 per cent. In the UK, the FTSE 100 climbed 0.7 per cent to 6,241.38.

Stocks were boosted after ECB executive board member Benoit Coeure insisted the eurozone remains on the road to recovery and reiterated the bank is "ready to take additional non-conventional measures, if needed".

 

Yesterday all major European indexes came under intense pressure following a string of negative data from Germany and concerns the eurozone could slip back into recession.

Earlier this week, Germany slashed its growth forecast for this year and 2015 and France reiterated in its budget proposal it would not meet its deficit target of 3 per cent until 2017.

On Wednesday, Greek stocks took a battering and bond yields jumped above the 7 per cent threshold-which many analysts believe is unsustainable- after the anti-bailout party, Syriza, took the lead in a poll.

The sell-off also called into question Athens' plan to exit its bailout programme a year earlier than expected.

On Thursday, Spain failed to cover a €3.5bn (£2.8bn) debt auction as the sell-off in the periphery continued.

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