On Monday, European stocks advanced as Federal Reserve Bank of Chicago President Charles Evans indicated that the region’s debt crisis will prompt the US Central Bank to delay raising interest rates. European equities advanced by midday, brushing off a downgrade to Spain’s sovereign credit rating, though the region’s stocks were headed for their worst monthly losses in 14 months on the eurozone’s debt problems. Aiding sentiment, the Business Climate Indicator for the eurozone improved slightly in May, suggesting economic activity in industry would continue to recover in the coming months. US futures and most Asian shares rose.
On Tuesday, BP shares, which hit their lowest level in more than a year, have now lost more than a third of their value since the oil spill began six weeks ago – a wipeout of about £43 billion ($62.75 billion) in market capitalisation.
On the economic front, manufacturing activity in the eurozone expanded in May at a considerably slower pace than April’s 46-month high, fuelling doubts over the sustainability of an economic recovery. Worries over the outlook for global economic recovery also pressured commodity prices, with crude and metals prices retreating. Asian stocks fell, extending the MSCI Asia Pacific Index’s biggest monthly fall since October 2008, as investors speculated over the future of Japan’s prime minister and Chinese manufacturing growth slowed.
On Wednesday the, euro was higher after some of the world’s biggest central banks said they would not stop investing in the single currency. The US opened criminal and civil investigations into BP Plc’s Gulf of Mexico oil spill. Asian shares fell,
following the resignation of Japan’s prime minister, while US futures rose.
European shares rose on Thursday to a two-week high, as investors’ confidence in the global economy improved after strong US data, with banks and beaten-down energy stocks rallying. Energy stocks broke their four-day falling pattern. BP, recently battered by concerns over the Gulf of Mexico
disaster, rose 3.7 per cent. The company said its robot submarines had made faltering progress in its latest bid to siphon off the oil spill. The stock has still fallen by 32 per cent since start of the spill. Carmakers were in demand, after US car sales rose 19 per cent in May from the depressed levels of a year earlier. Japanese stocks also rose, propelling benchmark indices to their biggest gains in six months, as increased sales of homes and cars in the US boosted confidence in the world’s biggest
economy.
On Friday European stocks advanced for a fifth day ahead of a report that may show American employers generated jobs in May for a fifth consecutive month. US index futures gained, while Asian shares retreated.