Europe stocks log gains ahead of holidaysPosted on Friday, December 23, 2011 - 22:32 pm
By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) — European stocks closed higher after holiday-thinned trading Friday, helped by energy shares such as BP PLC and drug issues including Roche Holding AG.
Markets in London closed early, and European markets are closed next Monday for the Christmas holiday.
The Stoxx Europe 600 index /quotes/zigman/2380150 XX:SXXP +0.87% rose 0.9% to 241.83, after closing 1% higher in the prior session.
The index ended the week up over 3%, but on a year-to-date basis, it has lost over 12%.
Among stocks on the move, shares of heavily-weighted Roche Holding /quotes/zigman/278482 CH:ROG +1.16% rose 1% after its ovarian-cancer drug, Avastin, won European Union clearance for treatment of women with a newly diagnosed advanced case of the disease.
Europe's week ahead
Markets will be watching France for any developments related to a potential downgrade for the nation, and Spain's new prime minister is expected to give more details about the government's plans to reduce its budget deficit.
U.S. stock markets traded higher after a mixed bag of November data, including lackluster consumer spending and personal incomes, stronger-than-expected orders for durable goods, and a sharp gain for new home sales in November.
Still, some flagged the lack of rising incomes in the U.S., saying that this could harm any budding recovery.
“The personal income and spending data weren’t that good, and it’s a big danger for next year,” said Koen De Leus, strategist at KBC Securities. “People say the macro data are in good shape [from the U.S.] but you really have to take care with these two components.”
A lack of traders helped draw attention away from sovereign-debt issues on Friday initially, but De Leus noted that bond yields were creeping higher. Stock markets were largely lifted this week after a strong take-up of three-year loans by the European Central Bank, with some of that money expected to be directed toward buying of sovereign debt.
But De Leus said it didn’t appear to be working quite yet.
Italian 10-year government bond yields /quotes/zigman/4869096 IT:10YR_ITA +0.06% moved higher, climbing to around the 7% level from 6.79% late the prior day. Bond prices move inversely to their yields.
The FTSE Italy MIB index /quotes/zigman/1482176 XX:FTSEMIB +0.31% rose just 0.3% to 15,073.99, with banks UniCredit SpA /quotes/zigman/172005 IT:UCG -3.43% and Unione di Banche Italiane SCpA /quotes/zigman/326822 IT:UBI -2.67% trading down by 3% and 2%, respectively. Banks across Europe made strong gains in the prior session.
Italy’s Senate gave final approval to a $40 billion emergency austerity and growth package on Thursday following a lengthy debate, according to media reports. Recently installed Prime Minister Mario Monti had called for a confidence vote on the measures.
Oil stocks lead gains
Crude oil continued to edge nearer the $100-a-barrel mark, lifting energy stocks like BP /quotes/zigman/247026/quotes/nls/bp BP +0.74% /quotes/zigman/210014 UK:BP +2.09% , which closed up 2% in London, and Total SA /quotes/zigman/167990/quotes/nls/tot TOT +1.73% /quotes/zigman/167939 FR:FP +2.13% , up 2% in Paris.
Gains for BP lifted the FTSE 100 index /quotes/zigman/3173262 UK:UKX +1.02% 1% higher to 5,512.70, ending the week up 2.3%. Shares of Tullow Oil PLC /quotes/zigman/271296 UK:TLW +3.05% rose 3% and several utilities also helped out, with National Grid PLC /quotes/zigman/381306 UK:NG +2.49% adding 2.5% and Centrica PLC /quotes/zigman/357817 UK:CNA +1.86% gaining 1.9%.
Total’s gains boosted the French CAC /quotes/zigman/3173214 FR:PX1 +0.99% 1% to 3,102.09. Utilities also rose in Paris, with Veolia Environnement SA /quotes/zigman/262846 FR:VIE +3.59% up 3.6%. Luxury-goods group LVMH Moet Hennessy Louis Vuitton SA /quotes/zigman/165796 FR:MC +1.64% rose 1.6%, continuing strong gains for the shares from the prior session.
The French index gained over 4% for the week.
Less stellar gains were seen in Frankfurt, where the German DAX 30 index /quotes/zigman/2380246 DX:DAX +0.46% rose 0.5% to 5,878.93, led by a 1.7% rally for Deutsche Bank AG /quotes/zigman/207036 DE:DBK +0.44% . But shares of Commerzbank AG /quotes/zigman/144405 DE:CBK -1.84% led decliners with a 0.7% drop, easing back following sharp gains the prior day.
The German index closed the week up 3.1%.
Barbara Kollmeyer is an editor for MarketWatch in Madrid.