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Financial firms, miners lead European stock rally

China Daily | Updated: 2008-03-28 07:45

European stocks rose, led by financial firms and mining companies, on prospects for improved earnings. US index futures gained, while Asian shares fell for the first time in five days.

Swiss Life Holding, the country's biggest life insurer, climbed to a two-month high after posting record profit, and Man Group Plc advanced as the hedge fund manager said earnings will top predictions. HBOS Plc of the United Kingdom led gains by banks.

Europe's Dow Jones Stoxx 600 Index, down 16 percent this year, added 1.1 percent to 307.9 as of 12:15 pm in London. The index price-earnings ratio is now 11.2, near the lowest since at least January 2002, weekly Bloomberg data show, and earnings will probably only rise 2.8 percent this year. Futures on the Standard & Poor's 500 Index gained 0.4 percent, while the MSCI Asia Pacific Index dropped 0.7 percent.

National benchmark indexes rallied in all 18 western European markets. The UK's FTSE 100 added 0.8 percent. France's CAC 40 increased 0.7 percent and Germany's DAX rose 1.1 percent.

Swiss Life climbed 7.1 percent to 268 francs. Switzerland's largest life insurer said 2007 profit rose 44 percent to a record 1.35 billion Swiss francs ($1.36 billion) on the sale of its Belgian and Dutch units and the Banca del Gottardo private bank.

Man Group gained 2.4 percent to 558.5 pence after the world's biggest publicly traded hedge fund manager said annual earnings will exceed analysts' estimates, helped by rising performance fees.

Financial stocks have underperformed the market in the past year as credit losses and mortgage writedowns worldwide reached more than $208 billion since the beginning of 2007.

HBOS, Britain's biggest mortgage lender, added 3.6 percent to 561 pence. Banca Popolare di Milano Scrl, with about 700 branches concentrated in Italy's wealthy northern regions, increased 3.2 percent to 7.30 euros.

Compass Group, the biggest provider of food services to companies, hospitals and schools, jumped 3.8 percent to 322.25 pence. Five-month sales and profit beat its forecasts after the company negotiated better terms with suppliers and won contracts.

BHP Billiton Ltd, the world's biggest mining company, gained 1.9 percent to 1,478 pence. Rio Tinto Group, the third-largest, climbed 2.1 percent to 5,154 pence.

Copper for delivery in three months climbed 2.1 percent to $8,350 a metric ton, bringing its gain for the past three days to 6.4 percent.

Agencies

(China Daily 03/28/2008 page16)

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