Stocks rise ahead of Spanish bond sale
European stocks have made gains shortly after open this morning (June 7th), ahead of a crucial Spanish bond sale which will serve to test market confidence.
The troubled Iberian country will try to raise money on credit markets today after reports claimed the beleaguered eurozone nation had been seeking bailout funds from the 17-nation bloc to bypass its government and go directly to its banks.
Yesterday, the Spanish economy minster Luis de Guindos commented that his fellow decision-makers were not seeking such a rescue fund.
He noted earlier in the week that the credit markets have been "effectively shut" to the country, adding fuel to the fire that there would be no other option than outside help in the form of a bailout.
In the upcoming sale, Spain will try to raise €1.6 billion (£1.3 billion) in bonds to test the market's confidence in its ability to pay.
It needs €80 billion to fortify its banking sector, which are struggling due to bad property loans.
Also today, prime minister David Cameron is to meet with German chancellor Angela Merkel to discuss these matters.
The British coalition government leader has stated that Germany - the largest economy in the eurozone - cannot be expected to resolve the sovereign debt crisis alone and new measures are needed to bring the bloc back to stability.
"Clearly the eurozone crisis is the biggest threat to the world economy, it the biggest challenge that we face today," he remarked.
At 08:32 BST, the Madrid IBEX advanced more than one per cent to an index value of 6488.9 points - buoyed by investor hopes that the bond sale will be successful.
Meanwhile, the Dax in Frankfurt rallied 0.5 per cent to 6127.6, while the Cac 40 in Paris also climbed 0.5 per cent to 3075.6.
Finally, in London the FTSE 100 increased by 0.4 per cent to 5405.5 points.
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