Tuesday, September 7, 2010

Europe's main stock markets recovered further yesterday, boosted by rallying banking shares as concerns about Dubai's debt crisis eased, analysts said.
In late morning European deals, London's benchmark FTSE 100 index was up 0.53 per cent at 5,355.36 points.

Frankfurt's DAX 30 gained 0.85 per cent to 5,831.23 points and in Paris the CAC 40 increased by 0.88 per cent to 3,829.29 points nearing the half-way stage.

The DJ Euro Stoxx 50 index of top eurozone shares won 0.80 per cent to 2,900.89 points.

"The FTSE 100 has benefited from renewed interest in the banking sector," said IG Index chief market strategist David Jones.

In London, Barclays bank jumped 4.74 per cent to 311.6 pence while Deutsche Bank rose 2.0 per cent to 49.92 euros in Frankfurt. The share price of French lender Societe Generale gained 2.60 per cent to 48.93 euros in Paris trading.

Gulf stock markets closed slightly up yesterday, with the initial shock waves from the Dubai debt crisis that caused heavy losses appearing to have subsided, traders said.

Qatar's Doha Securities Market closed 1.21 per cent higher to rise above the psychological 7,000-point barrier, spurred by the banking sector.

The DSM added 5.3 per cent on Wednesday, a day after shedding 8.3 per cent on fears local companies could be exposed to the Dubai debt crisis.

The two United Arab Emirates markets of Dubai and Abu Dhabi were closed for the second day on a national holiday, while the Saudi market, the largest Arab bourse, and Oman remain shut for the Muslim Eid al-Adha holidays.

Meanwhile market reaction to Dubai's credit woes has been "overstated," the head of an Abu Dhabi-controlled bank said yesterday, amid fears the Gulf city state may default on billions of dollars worth of debt.

"We are very confident and optimistic about (the regional economy)," Michael Tomalin, chief executive of National Bank of Abu Dhabi, said.
"I think the market reaction to Dubai has been very overstated."

News that conglomerate Dubai World had asked for a moratorium on tens of billions of dollars in debt sent world markets into a tailspin last week, but analysts have said oil-rich Abu Dhabi would step in to help its neighbour.