European stocks rallied to the highest in 12 weeks after the region's leaders agreed to expand a bailout fund to halt the sovereign debt crisis.
BNP Paribas SA, France's biggest bank, and Deutsche Bank AG, Germany's largest, surged at least 15 percent as policy makers decided to boost the firepower of the European rescue fund to 1 trillion euros ($1.4 trillion). PPR SA, the French owner of the Gucci luxury-goods brand, jumped 5.4 percent after third-quarter sales surpassed analyst estimates.
The Stoxx Europe 600 Index rose 3.6 percent to 249.42 at the close, the highest since Aug. 3. The index has rallied 16 percent from this year's low on Sept. 22 amid growing speculation that policy makers would agree on a solution to the region's debt woes.
“Some of the fear, which has been the dominant factor in the market, has been removed,” said Pierre Mouton, a fund manager who helps oversee $7.5 billion at Notz Stucki & Cie. in Geneva. “Europe came to an agreement and has a plan.
This allows financial stocks to rise because there is no longer the specter of nationalization. There is a sense of relief for the banking sector.”
National benchmark indexes gained in all of the 18 western European markets. Germany's DAX jumped 5.4 percent, its biggest increase since April 2009. France's CAC 40 climbed 6.3 percent and the U.K.'s FTSE 100 rose 2.9 percent.
Crisis Summit
European leaders persuaded bondholders to take 50 percent losses on Greek debt and resolved to increase the size of the rescue fund, responding to global pressure to step up the fight against the financial crisis.
The euro area's stewards said the plan points the way out of the debt quagmire, even if key details are lacking. Last- ditch talks with bank representatives led to the debt-relief accord, in an effort to quarantine Greece and prevent speculation against Italy and France from ravaging the euro area and wreaking global economic havoc.
Measures include recapitalization of European banks, a potentially bigger role for the International Monetary Fund, a commitment from Italy to do more to reduce its debt and a signal from leaders that the European Central Bank will maintain bond purchases in the secondary market.
NEWS BY:http://news.businessweek.com/article.asp?documentKey=1376-LTPMFT07SXKX01-2PP1LOBI2ME6NHCIBLM6OQV98T
BNP Paribas SA, France's biggest bank, and Deutsche Bank AG, Germany's largest, surged at least 15 percent as policy makers decided to boost the firepower of the European rescue fund to 1 trillion euros ($1.4 trillion). PPR SA, the French owner of the Gucci luxury-goods brand, jumped 5.4 percent after third-quarter sales surpassed analyst estimates.
The Stoxx Europe 600 Index rose 3.6 percent to 249.42 at the close, the highest since Aug. 3. The index has rallied 16 percent from this year's low on Sept. 22 amid growing speculation that policy makers would agree on a solution to the region's debt woes.
“Some of the fear, which has been the dominant factor in the market, has been removed,” said Pierre Mouton, a fund manager who helps oversee $7.5 billion at Notz Stucki & Cie. in Geneva. “Europe came to an agreement and has a plan.
This allows financial stocks to rise because there is no longer the specter of nationalization. There is a sense of relief for the banking sector.”
National benchmark indexes gained in all of the 18 western European markets. Germany's DAX jumped 5.4 percent, its biggest increase since April 2009. France's CAC 40 climbed 6.3 percent and the U.K.'s FTSE 100 rose 2.9 percent.
Crisis Summit
European leaders persuaded bondholders to take 50 percent losses on Greek debt and resolved to increase the size of the rescue fund, responding to global pressure to step up the fight against the financial crisis.
The euro area's stewards said the plan points the way out of the debt quagmire, even if key details are lacking. Last- ditch talks with bank representatives led to the debt-relief accord, in an effort to quarantine Greece and prevent speculation against Italy and France from ravaging the euro area and wreaking global economic havoc.
Measures include recapitalization of European banks, a potentially bigger role for the International Monetary Fund, a commitment from Italy to do more to reduce its debt and a signal from leaders that the European Central Bank will maintain bond purchases in the secondary market.
NEWS BY:http://news.businessweek.com/article.asp?documentKey=1376-LTPMFT07SXKX01-2PP1LOBI2ME6NHCIBLM6OQV98T
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