European stocks push higher on eve of key ECB meet

GMT 14:01 2016 Wednesday ,09 March

Arab Today, arab today European stocks push higher on eve of key ECB meet

London's benchmark FTSE 100 index
Hong Kong - AFP

Europe's main stock markets pushed higher Wednesday, the eve of a key meeting of the ECB and after losses across Asia, as traders look for policy action from central bankers.

The European Central Bank will almost certainly announce new stimulus measures at its policy meeting Thursday, analysts said, as eurozone inflation turns negative and the economic outlook continues to cloud over.

"Despite a rough Asian session, with the lingering effects of China’s export-plunge causing both the Shanghai Composite and the Nikkei to feel the pinch, the European indices have started the day tentatively in the green after two days of nervy losses," said Connor Campbell, analyst at Spreadex trading group.

London's benchmark FTSE 100 index was up 0.1 percent, while eurozone heavyweights Frankfurt and Paris gained 0.5 percent in late morning deals. The euro was stable against the dollar.

World indices had fallen heavily on Tuesday and nervous investors in Asia resumed selling Wednesday on worries over the weak global economy.
The International Monetary Fund on Tuesday urged governments to take action to prevent another global recession, warning there was an increasingly "dangerous" view that policymakers are out of ideas or had lost the will.

- ECB action -

After disappointing financial markets with what were widely perceived as half-hearted measures in December, ECB chief Mario Draghi will announce bolder policy moves this time round, central bank watchers predicted.

These were most likely to include a further cut in interest rates, an increase in the volume of bonds it buys each month under its so-called quantitative easing or QE stimulus programme and a further extension of that measure beyond its current timeframe of March 2017.

"Much of today's market action will be in relation to final positioning ahead of the ECB tomorrow," said City of London Markets trader Markus Huber.

"So far ECB action of the recent past had only mixed success at best, as growth is still sluggish and inflation remains at very low levels."

In company news, German power giant E.ON said it booked a 7.0-billion-euro ($7.7-billion) net loss in 2015 and warned that "the course ahead will be tougher and longer than anticipated".
German power utilities have complained that the country's transition from conventional carbon fuels to greener, cleaner sources of energy is squeezing their margins.

E.ON shares were down 0.44 percent at 8.29 euros in Frankfurt deals.

In Asia, investors resumed selling on Wednesday as the optimism that had fuelled this month's rally was broken by another round of weak Chinese data that rekindled fears about the global economy.

After a string of gains in recent weeks, confidence took a hit on Tuesday when China released data showing exports from the world's number two economy had plunged the most since the financial crisis.

The news refocused attention on the slowdown in China -- one of the key reasons global markets suffered a bloodbath at the start of the year -- sending markets tumbling from Asia to the Americas.

- Key figures around 1030 GMT -

London - FTSE 100: UP 0.1 percent at 6,128.61

Frankfurt - DAX 30: UP 0.5 percent at 9,737.70

Paris - CAC 40: UP 0.5 percent at 4,426.05

EURO STOXX 50: UP 0.6 percent at 3,019.33

Tokyo - Nikkei 225: DOWN 0.8 percent at 16,642.20 (close)

Shanghai - composite: DOWN 1.3 percent at 2,862.56 (close)

Hong Kong - Hang Seng: DOWN 0.1 percent at 19,996.26 (close)

New York - Dow:  DOWN 0.6 percent at 16,964.10 (close)

Euro/dollar: DOWN at $1.1010 from $1.1013 on Tuesday

Dollar/yen: DOWN at 112.64 yen from 113.41 yen



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