British Airways gains on RBS upgrade

| November 10, 2008 | 0 Comments
British Airways gains on RBS upgrade

Most European equities markets saw gains Monday after an announcement from the Chinese government that it will spend 4 trillion yuan ($586 billion) in the next two years in support of its economy.

In London, the FTSE 100 was up 0.89 percent to 4,403.92 and the FTSE 250 added 1.08 percent to 6,656.56 on gains in the mining sector after metals prices gained on the announcement from China.

British Airways (LSE: BAY; NYSE: BAB) added 7.53 percent after Royal Bank of Scotland (LSE: RBS A, RBS B; NYSE: RBS.A, RBS.B) raised its recommendation on the airline from “sell” to “buy”.

The FTSE Eurofirst 300 added 0.86 percent to 922.48 while the CAC-40 was up 1.06 percent to 3,505.75 and the Dax gained 1.76 percent to 5,025.53 but the IBEX fell 0.53 percent to 9,293.8.

Equities markets in the Asia-Pacific region were also helped by the prospect of more spending by China. With most markets in the region seeing gains, with the exception of Taiwan’s Taiex, which dropped 0.04 percent to 4,740.27 after the central bank there cut interest rates again.

The Straits Times Index was up 1.16 percent to 1,885.02 while in Australia the Sydney Ordinaries added 1.33 percent to 4,060 and the S&P/ASX200 was 1.39 percent higher to 4,107.8.

In South Korea, the Kospi gained 1.58 percent to 1,152.46, Hong Kong’s Hang Seng was up 3.52 percent to 14,744.63, India’s Sensex added 5.74 percent to 10,536.16 and the Shanghai Composite jumped 7.27 percent to 1,874.8.

In Tokyo, the Nikkei 225 added 5.81 percent to 9,081.43, the Topix index was up 4.28 percent to 916.65 and the Mothers market gained 2.83 percent to 337.95.

Wall Street saw declines after early gains as investors decided that China’s announced stimulus plan will not have much of an effect on the US economy.

The Dow Jones Industrial Average was down 0.47 percent to 8,901.44 at just past 1:30 p.m. in New York, while the Nasdaq Composite had fallen 1.42 percent to 1,624.01 and the S&P 500 had dropped 0.9 percent to 922.62.

Crude oil prices and most metals were higher, while grains prices were mixed.

The Japanese yen was weaker on a return to carry trades on the news about China’s stimulus plan but made back some of its declines later in the session, while the pound saw gains versus the US dollar.

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