The European market Wednesday insisted its upward momentum after a long-awaited report from Moody's on Spain did not contain the expected downgrade of its credit rating. At the same time a string of positive news for several large European companies sent mood firmly upwards.
Wednesday the British FTSE100 index ended in a plus of 0.7 percent, while the French CAC40 and the German DAX rose 0.8 and 0.3 percent. In Spain, there was the focal point of Wednesday's trading, the benchmark IBEX index increased by 2.4 percent.
The European stock markets had already risen solidly on Monday and Tuesday before Moody's Wednesday morning published its report on Spain. The study of the country was started in the summer, and surprisingly Moody's chose not to downgrade Spain's credit rating from BBB-. Thus the country is still "investment grade" as opposed to the unflattering predicate "junk."
It sent the Spanish and Italian government bond yields down significantly, and both countries' ten-year bond yields closed at levels not seen since the spring. At the same it gave time investors little extra fuel to continue the last day shopping. With the cyclical stocks in front it created the increases in Europe, where 394 out of 600 shares in Europe Stoxx 600 index ended in positive territory.
In Spain, Bankia rose with 18.2 percent, Banco Popular by 6.3 percent and large bank Banco Santander by 3.7 percent.
In Finland Wärtsilä was lifted by 8.1 percent to 29.02 euro on top of a quarterly financial statement with a solid upgrade. The company, which manufactures engines for ships and power plants, expects sales growth in 2012 of 10-15 percent against the previous 5-10 per cent. Revenue in the third quarter was a tad better than expected, while the result was in line with expectations according to SME Direkt.
In Sweden, TeliaSonera fell by 1.6 percent to 45.40 SEK after an financial statement, which was characterized by fierce competition in the telecommunications market in the Nordic region.
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