LONDON (AP) — Rising oil prices helped stock markets in Europe post solid gains Wednesday despite a lower global growth forecast from the International Monetary Fund.
KEEPING SCORE: In Europe, France’s CAC 40 was up 0.7 percent at 4,692 while Germany’s DAX rose 1.1 percent to 10,009. The FTSE 100 index of leading British shares was 0.5 percent higher at 6,378. Wall Street was poised for modest gains at the open with Dow futures and the broader S&P 500 futures up 0.6 percent.
OIL REBOUND: One reason European stock markets were doing well was that oil stocks were higher in the wake of the rally in oil prices — rising oil prices should benefit the bottom line of oil producers and makes more projects affordable. The benchmark New York rate was up 1.6 percent at $49.31 a barrel. Meanwhile, Brent Crude, a benchmark for international oils, was up 1.6 percent at $52.75 a barrel in London. Among the stock risers were Britain’s BP, which saw its share price spike 2.8 percent while France’s Total SA enjoyed a 2.7 percent rebound.
ANALYST TAKE: “With oil rallying today it is hardly surprising to see major oil stocks extend their bounce into a second session,” said Chris Beauchamp, senior market analyst at IG.
GROWTH DOWNGRADE: The developments in the oil markets helped keep a lid on concerns that the global economy is experiencing a downturn. Those concerns were stoked by a report from the IMF that China’s slowdown and tumbling commodity prices will push global economic growth this year to the lowest level since the 2009 recession. The fund forecasts the world economy to grow 3.1 percent this year, down from a July forecast of 3.3 percent and from 3.4 percent growth last year. The IMF expects Chinese economic growth to drop to a 25-year low 6.8 percent this year, but that is unchanged from its July forecast.
ASIA’S DAY: Japan’s Nikkei 225 gained 0.8 percent to 18,322.98 and South Korea’s Kospi gained 0.8 percent at 2,005.84. Hong Kong’s Hang Seng rose 3.1 percent to 22,515.76. China’s markets are closed until Thursday. Australia’s S&P/ASX 200 was up 0.6 percent to 5,197.90. Benchmarks in Taiwan and Southeast Asia rose.
CURRENCIES: Trading in the currency markets was fairly subdued with the euro flat at $1.1264 and the dollar 0.1 percent lower at 120.10 yen.
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