-Markets rise on expectations for Greek bond deal
-Yields on Italian 10 year debt fall well below 5%.
-EADS says Chinese government bocking sales of A380s

FTSE-100: 1.18%
Euro Stoxx 50: 2.17%
Dax-30: 2.46%
Cac-40: 2.54%
Ibex 35: 1.78%
FTSE MIB: 1.62%

All major European stock markets have risen through Thursday as investors bet on a successful deal between the Greek government and its private sector lenders.

A bond swap, designed to reduce the stricken country’s debt burden by 53.5%, must be finalised by 22:00 this evening, with the result announced at 05:00 tomorrow morning.

Greece has said 75% of creditors must sign up to the programme before it will start issuing the new bonds. The latest reports suggest 60% of lenders have done so, with expectations that the rest will follow before tonight’s deadline.

The perception that a full Greek default will be avoided has increased demand for Italian debt, seen as the most likely victim of ‘contagion’. The yield on 10 year Italian bonds had fallen 13 basis points by 17:30 in Rome to 4.8%, a long way from the highs of over 7% seen late last year.

German industrial production also surprised on the upside, rising 1.6% between January and December.

US jobless benefits claims for the week ending March 3 rose by 8,000 to 362,000. Recent employment data from the US has been one of the factors pushing markets higher through 2012.

EQUITIES

EADS, which owns Airbus, says the Chinese government is blocking sales of its A380 wide bodied aircraft because it is angry at a European Union carbon trading scheme. Nevertheless EADS shares managed take off on Thursday, after the company decided to more than double the dividend. By the close the stock had risen 10.8%.

French supermarket chain Carrefour is to slash its dividend and capital spending, with the company predicting another tough year for cash-strapped shoppers. It closed the day 0.5% higher.

French banking giant BNP Paribas climbed 3.7% after it managed to sell a stake in the real estate firm Klepierre to Simon Property Group.

The strongest sectors on the Stoxx Europe 600 were automobiles (3.91%) and industrial goods and services (2.75%). Utilities were the weakest, gaining just 0.01% by the close

MACROECONOMY

Dutch consumer prices rose by 0.8% month-on-month in February (Consensus: 0.7%).

Swiss consumer prices increased by 0.3% month-on-month in February (Consensus: 0.2%).

The French central bank’s business sentiment index fell to the 95 point mark in February, from 96 the month before.

OTHER MARKETS

Front month Brent crude futures contracts rose1.46% by 16:37 in London to $125.93 per barrel.

The euro/dollar had gained 0.84% by 17:51 in Frankfurt to hit $1.3263.

BS