ROME: European stocks rose on Friday, as the Federal Reserve’s latest policy meeting continued to support equities, although concerns over a potential Greek default persisted.
During European morning trade, the EURO STOXX 50 gained 0.80%, France’s CAC 40 advanced 0.75%, while Germany’s DAX 30 climbed 0.77%.
Equity markets strengthened as investors pushed back expectations on the timing of an initial U.S. rate hike after the Federal Reserve lowered both its U.S. growth forecast and its interest-rate projections at its policy meeting on Wednesday.
But investors remained cautious after a meeting between Greek and euro zone officials broke down on Thursday, bringing the prospect of a Greek exit from the single currency bloc a step closer.
The current bailout for Greece expires on 30 June when Athens is also due to repay the IMF around €1.6 billion. Lagarde said if the payment is not made on time, Greece will be declared to be in default and would disqualify itself from receiving any further IMF funds.
Financial stocks were broadly higher, as French lenders BNP Paribas (PARIS:BNPP) and Societe Generale (PARIS:SOGN) climbed 0.81% and 0.92%, while Germany’s Commerzbank (XETRA:CBKG) advanced 0.47%.
Among peripheral lenders, Italy’s Intesa Sanpaolo (MILAN:ISP) and Unicredit (MILAN:CRDI) gained 0.35% and 0.79% respectively, while Spanish banks Banco Santander (MADRID:SAN) and BBVA (MADRID:BBVA) rallied 1% and 1.12%.
Elsewhere, Alcatel-Lucent (PARIS:ALUA) jumped 1.12% after Nokia Oyj (HEL:NOK1V) won U.S. antitrust approval for its €15.6 billion takeover of the French telecommunications-equipment company.
