European stocks mixed after BoE talk
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LONDON, Feb 20 AFP
February 21 2013, 05:12AM
European stock markets diverged on Wednesday, with London gaining on an increasing prospect of more cash stimulus from the Bank of England (BoE), while Paris dropped on profit-taking, analysts said.
At closing, London's FTSE 100 index of leading companies gained 0.26 per cent to 6395.37 points while Frankfurt's DAX 30 dipped by 0.30 per cent to 7728.90 points and in Paris the CAC 40 fell 0.69 per cent to 3709.88 points
"The apparent shift towards more easing by the UK central bank was sufficient to lift the FTSE 100 over the 6400 mark, revisiting this level for the first time since January 2008," said Chris Beauchamp, an analyst at IG trading group.
But the index dipped below the benchmark in late trade, falling closer in line with other European markets.
Bank of England governor Mervyn King called for more quantitative easing stimulus cash earlier this month, minutes of the BoE's February meeting showed on Wednesday, pushing the pound to a near 16-month low against the euro.
The BoE's nine-member Monetary Policy Committee voted 6-3 to keep its QE cash stimulus amount at STG375 billion ($A562.73 billion), according to minutes from their February 6-7 gathering.
However, outgoing chief King was joined by fellow MPC members David Miles and Paul Fisher in calling for another STG25 billion in stimulus cash as Britain faced the prospect of a third recession in five years.
While the BoE minutes lifted the FTSE, they dragged down sterling, which hit multi-month low points versus both the euro and dollar.
The British pound slumped to $1.5282 - the lowest level since June - and to 87.27 pence against the euro, a level not seen in 16 months.
In later trading, sterling stood at $1.5295 compared with $1.5425 late on Tuesday in New York. The pound weakened to 87.47 pence for one euro, from 86.81 pence.
The European single currency meanwhile fell to $1.3350 from $1.3390 on Tuesday. The dollar rose to 93.59 yen from 93.54 yen.
Gold prices dropped to $US1588.50 ($A1541.93) an ounce from $1607.75 on the London Bullion Market.
In company news, shares in Vodafone slipped 0.61 per cent to 162.50 pence after the British mobile phone giant said it had successfully bid STG790 million for a 4G licence to provide super-fast mobile internet access across Britain.
Deutsche Boerse fell 0.64 per cent to 47.35 euros after the German stock market operator said its earnings were hit last year by the "challenging market environment."
Deutsche Boerse said in a statement released in Frankfurt late on Tuesday that group net profit had fallen by 24.6 per cent to 645 million euros ($A840.72 million) .