The European stock markets opened the fourth quarter with decent gains after the release of the results of the Spanish bank test, which showed a capital needs in the context of what was devoted to the Spanish banking sector in the EU rescue fund EFSF. Moreover, U.S. data helped lift the mood as the ISM index for U.S. manufacturing showed a somewhat larger increase than expected.
In London FTSE 100-index rose 1.4 percent. Financial shares led the way, including HSBC, which closed 2.5 percent higher. Among the other banks Barclays rose 3.5 percent and Lloyds Bank 3.0 percent. In addition, mining company Xstrata increased 2.4 percent, after the company's board has recommended the shareholders to vote for the offer of 33 billion dollar from Glencore International.
At the Paris Stock Exchange the CAC 40 index rose 2.4 percent. The large Bank Credit Agricole contributed with an increase of 7.4 percent after having started exclusive negotiations for the sale of its loss-making Greek unit, Emporiki Bank, to Alpha Bank for the symbolic amount of 1 euro. Alpha Bank rose 6.6 percent.
The Spanish bank Banco Populare Espanol on other hand fell 4.8 percent after news that it will sell shares of 2.5 billion euro to strengthen its capital position. The bank also indicated that it for 2012 now awaits a deficit of 2.3 billion euro, compared with an earlier estimate for a profit of 400 million euro. This happens after it has taken a more critical look at the loan portfolio and the bank has also made a forecast based less on capital gains. The stress test of Banco Populare showed that it has a capital requirement of 3.2 billion euro in an adverse economic scenario. The Bank's share has dropped 57 percent in 2012.
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