European Markets Climbed On Strong Economic Data

(RTTNews) - The European markets ended Wednesday's session in positive territory. Investor sentiment received a boost from the stronger than expected German consumer confidence data. The unexpected decline in U.S. weekly jobless claims provided further support in the afternoon.

Spanish economic recovery continued into the fourth quarter, the Bank of Spain said on Wednesday, citing recent data. The economy exited a long recession in the third quarter with the gross domestic product growing 0.1 percent from the previous three months. It was the first expansion since early 2011.

Improvement in private consumption, especially car sales, construction spending, exports, tourism, industrial activity, services and labor market is helping the recovery, the bank said in its latest monthly bulletin. The current account is also signaling a favorable trend, the bank noted.

Ireland has to seek formal aid from the European Stability Mechanism if the government plans to access the bond buying program dubbed as Outright Monetary Transactions, European Central Bank Executive Board member Joerg Asmussen said in an interview on Wednesday.

"Ireland was not eligible for OMT and will not be after the 1st of January," Asmussen told the Irish Times.

Citing a release from ECB, the policymaker said having a full or a precautionary EFSF/ESM programme is a necessary condition for a country to be eligible for OMT, provided that they include the possibility of ESM primary market purchases.

"Ireland's decision not to apply for a precautionary programme means it currently does not fulfill this necessary condition," Asmussen said.

The recent fall in mortgage approvals for house purchases in the U.K. signals that banks are taking a cautious approach to expanding their mortgage lending, Capital Economics Property Economist Matthew Pointon said.

According to the economist, lenders are wary about extending mortgages to households with fragile finances, and against homes that look overvalued. However, mortgage approvals are expected to increase steadily in the coming months as the economy recovers.

The Euro Stoxx 50 index of eurozone bluechip stocks increased by 0.65 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.49 percent.

The DAX of Germany climbed by 0.66 percent and the CAC 40 of France advanced by 0.36 percent. The FTSE 100 of the U.K. rose by 0.20 percent and the SMI of Switzerland gained 0.08 percent.

In Frankfurt, HeidelbergCement climbed by 1.42 percent. Berenberg upgraded its rating on the stock to ''Buy'' from ''Hold.''

RWE gained 0.09 percent and peer E.ON added 0.18 percent.

In Paris, Accor dropped by 7.48 percent. The hotel group unveiled a new strategy, which includes redefinition of the group's business model around its two core missions - HotelServices and HotelInvest - for maximum operational performance & sustainable growth.

Veolia Environnement decreased by 3.00 percent, after Electricite de France sold its stake in the company. EDF finished with a gain of 0.15 percent.

In London, Compass Group rose by 1.30 percent, after it reported a higher adjusted pre-tax profit.

United Utilities dipped 0.08 percent. The water utility reported a significantly higher profit for the first half of the year, reflecting improvement in fair value gains as well as increased taxation credit.

Britvic finished higher by 2.88 percent. The stock was upgraded to ''Overweight'' from ''Equalweight'' at Barclays.

Royal Mail surged by 6.00 percent, after it reported a sharp increase in profit for the first half of the year.

De La Rue fell by 6.00 percent, after Citigroup downgraded its rating on the stock to "Neutral" from "Buy."

Societe Generale upgraded Zurich Insurance to ''Buy'' from ''Hold.'' The stock climbed by 0.52 percent in Zurich.

A leading indicator of the euro area increased further in October, signaling continued improvement in the outlook for the economy, data from a survey conducted by the Conference Board showed Wednesday. The leading economic index moved up 0.6 percent month-on-month to 110.4 in October, after rising 0.5 percent and 0.9 percent respectively in September and August.

Germany's consumer confidence hit a 6-year high towards the end of 2013 as hopes of a faster recovery and the reduction in interest rates boosted consumer mood, survey data from the market research group GfK showed Wednesday.

The forward-looking consumer confidence index for December rose to 7.4 from a revised value of 7.1 points in November. The reading was forecast to rise by 0.1 points from November's originally estimated value of 7.

Confidence among French households decreased modestly in November from the previous month, survey data released by statistical office Insee revealed Wednesday. Economists had forecast sentiment to remain unchanged. The consumer confidence index dropped to 84 in November from 85 in the previous month. The index was forecast to stay unchanged at the October level.

The U.K. economy expanded 0.8 percent in the third quarter from the previous quarter, in line with the initial estimate published on October 25. Gross domestic product grew at the fastest pace since the second quarter of 2010, and follows 0.7 percent growth in the second quarter of 2013, data from the Office for National Statistics showed Wednesday.

Retail sales in the U.K. remained flat for the second successive month in November, contrary to expectations for a strong growth, latest data showed Wednesday. The latest distributive trades survey conducted by the Confederation of British Industry (CBI) showed that the retail sales balance dropped to 1 percent in November from 2 percent in October. The outcome was far below the 10 percent forecast by economists.

With orders for transportation equipment and computers showing notable decreases, the Commerce Department released a report on Wednesday showing a pullback in new orders for U.S. manufactured durable goods in the month of October.

The report said durable goods orders fell by 2.0 percent in October after jumping by an upwardly revised 4.1 percent in September. The drop in orders matched economist estimates.

In an upbeat sign for the labor market, the Labor Department released a report on Wednesday showing an unexpected decrease in initial jobless claims in the week ended November 23rd. The report said initial jobless claims slid to 316,000, a decrease of 10,000 from the previous week's revised figure of 326,000.

The modest decrease came as a surprise to economists, who had expected jobless claims to climb to 330,000 from the 323,000 originally reported for the previous month.

After reporting a substantial acceleration in the pace of growth in Chicago-area business activity last month, MNI Indicators released a report on Wednesday showing a slowdown in the pace of growth in the month of November.

MNI Indicators said its Chicago business barometer dipped to 63.0 in November after jumping to 65.9 in October, although a reading above 50 still indicates growth. Economists had expected the business barometer to drop to a reading of 60.5.

Consumer sentiment in the U.S. improved in the month of November, according to revised data released by Thomson Reuters and the University of Michigan on Wednesday. The report said the final reading on the consumer sentiment index for November came in at 75.1, reflecting a substantial upward revision from the preliminary reading of 72.0.

Indicating strengthening conditions in the underlying economy, the Conference Board released a report on Wednesday showing that its reading on leading U.S. economic indicators unexpectedly rose for the fourth straight month in October.

The Conference Board said its leading economic index edged up by 0.2 percent in October after rising by an upwardly revised 0.9 percent in September. Economists had expected the index to come in unchanged.