Europe stocks reach 2003 high
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LONDON, England (Reuters) -- European shares rose for a fifth straight session on Monday, clocking up fresh 2003 highs as economy sensitive sectors such as steel and chemicals shrugged off fears that a record-high euro may scupper recovery.
Business was thin as many investors were still on year-end holidays, with little fresh news to spur major moves, though the prospect of opening gains on Wall Street underpinned prices.
Shares in Italian food group Parmalat were suspended until further notice after the group was declared insolvent over the weekend.
The stock is already near worthless as a criminal probe into billions of missing euros continues to unfold due to suspected fraud in a scandal that broke mid-December.
Shares in Italy's Centrale del Latte di Torino were suspended limit up after the stock soared seven percent on hopes the group may snap up some of Parmalat's assets.
Dutch food group Ahold, after its own scandal earlier this year, rose 1.5 percent to six euros after closing a 300 million euro and $1.45 billion back-up credit facility to bolster its finances.
Among the day's other few standouts, UK motoring services firm RAC rallied after the firm said a joint venture company had won a seven-year contract with expected revenues of one billion pounds.
By 1152 GMT, the FTSE Eurotop 300 index was up 0.24 percent at 952 points after hitting a new 2003 high at 953.02 points.
The pan-European benchmark is on course to end the year up about 11 percent and snap a three-year losing streak, though is still only roughly half the level of its record high of September 2000.
"People are thinking about next year and confidence is pretty high," said John Hatherly, head of global analysis at M&G Asset Management.
Investors were betting that U.S. economic numbers due later in the week, such as consumer confidence and the Chicago purchasing management index will show the American economy continues to recover well, Hatherly said.
The market is also anticipating the fourth quarter U.S. earnings season, which begins mid-January, will be good as U.S. exporters benefit from a weaker dollar making their products more competitive abroad.
"The mood has been set and it's positive. For that to be broken down, you need hard evidence that expectations won't be met," Hatherly said.
The DJ Euro Stoxx 50 index of euro zone blue chips gained
The euro rose to a record high of $1.2494 against the dollar due to security worries and concerns over the U.S. current account deficit kept the greenback under pressure.
The euro has gained almost 19 percent against the dollar since the start of the year.
The Financial Times said a senior unnamed official at the European Central Bank was becoming increasingly uneasy about the euro's rise, fearing it could move substantially higher and undermine the euro zone recovery.
Some of Europe's top companies are major exporters and a stronger euro makes their products more expensive in America.
However, one of the year's best performing bourses has been Frankfurt, up 38 percent so far despite being home to many of Europe's top exporting firms.
The German government said it was not worried about the current strength of the euro.
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Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
