Optimism over global recovery raises indices

Eurostoxx 50: 3,018.38 (–5.99) Frankfurt DAX: 7,396.63 (+25.43) Paris CAC: 4,096.62 (–4.69)EUROPEAN STOCKS rose to their highest level since September 2008 yesterday, as a smaller-than-estimated contraction in Japan's economy spurred speculation that the global recovery will continue.

The Stoxx 600 advanced 0.4 per cent to 289.11 at the close in London. The measure has gained 83 per cent from the 12-year low that it reached in March 2009 as investors bet the strengthening global economic recovery will help corporate profits.

The rally has pushed the measure to about 16 times the reported earnings of its companies.

Wood Group climbed 14 per cent to 652p, the highest price since the company’s initial public offering in 2002.

Wood Group will return at least $1.7 billion in cash to shareholders and use the rest of the sale proceeds to reduce debt after buying PSN, a brownfield-services provider, in December.

Credit Suisse rose 1.9 per cent to 42.40 Swiss francs after saying that it will sell 6 billion francs of so-called CoCos to investors Qatar Holding and The Olayan Group.

Meda surged 14 per cent to 56.90 kroner after the drugmaker reported higher-than-estimated earnings and doubled its dividend.

Hochtief gained 3.1 per cent to €68.43 as the German company that controls Australia’s biggest builder Leighton Holdings predicted that profit for the 2010 fiscal year will be “well above” a year earlier.

Carrefour, the world’s second-largest retailer by sales, advanced 1.1 per cent to €35.77 as JPMorgan Chase added the shares to its analyst focus list.

Andritz, an Austrian machinery-maker, surged 3.2 per cent to €65.30.

Nexans jumped 3.9 per cent to €68.02 after the world’s largest cable maker posted 2010 net income of €82 million, compared with 2009 profit of €8 million.

Nokia Oyj, the world’s biggest maker of mobile phones, sank 5.3 per cent to €6.63, extending the previous day’s 14 per cent slump.

BASF gained 2.5 per cent to €59.49. The world’s biggest chemical company climbed after Citigroup named BASF among its most preferred shares.

ARM advanced 6.6 per cent to 651p, the highest price in a decade. – (Bloomberg)