UpdateEurope chemical stocks rise as EU majority agrees on treaty

09 December 2011 18:01  [Source: ICIS news]

LONDON (ICIS)--European chemical stocks rose on Friday at closing, in line with financial markets, after EU leaders received backing from most member states to sign a treaty with a view to tackling the eurozone debt crisis.

All 17 eurozone members have agreed to pursue stricter budget rules for the single currency area, while nine other EU members have shown interest.

UK is the only country which vetoed amendments to the EU treaty, with Prime Minister David Cameron reasoning that it was not in the country’s interest to join.

Hungary originally rejected the deal but changed its stance and has decided to consult with its parliament. The Czech Republic and Sweden will also consult their parliaments before making official decisions.

President of the European Council, Herman Van Rompuy said major decisions to safeguard the eurozone, both short-term and medium-term, have been agreed.

“The 17 member states of the eurozone and already many others are committed to a new fiscal compact. A new European fiscal rule, to be transposed in national legislation. It is about more fiscal discipline; more automatic sanctions; stricter surveillance,” he said.

“An intergovernmental treaty will make this agreement binding. In combination with secondary legislation and the firm political commitments, this will give the fiscal compact its full force,” he added.

Van Rompuy said the treaty is open to non-eurozone countries. “Except for one, all are considering participating,” he added.

The UK’s FTSE 100 closed 0.83% up, Germany’s DAX had risen by 1.91%, while the CAC 40 in France was up by 2.41%.

French President Nicolas Sarkozy and German Chancellor Angela Merkel first called for a new EU treaty on the 5 December, to be in place by March 2012, to ensure the EU’s financial meltdown would never happen again.

Sarkozy and Merkel had said they wanted the treaty changes to be implemented by all EU member states.

However, as this is now not possible, all 17 members of the eurozone and a possible nine more EU countries will work on a new agreement alongside the EU treaty in order to pass through tougher rules to prevent governments from spending or borrowing too much.

With European indices finishing higher, the Dow Jones Euro Stoxx Chemicals index at closing was up by 0.74%, as shares in many of Europe’s major chemical companies rose from the previous close.

Germany-based petrochemical major BASF’s shares climbed slightly by 0.04%, while Dutch coatings firm AkzoNobel was up by 1.09%. Germany-based chemical company Bayer's shares were trading up slightly by 0.42% and Swiss specialties maker Clariant were trading up by 0.69%.

However, shares in Belgium’s Solvay had fallen by 3.44%, while Germany’s Linde was down by 0.23%.

In related news, Croatia on Friday signed an accession treaty that will bring it into the EU in 2013.

(Additional reporting by Franco Capaldo)

By: Leigh Stringer
+44 208 652 3214

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly

Get access to breaking chemical news as it happens.
ICIS Global Petrochemical Index (IPEX)
ICIS Global Petrochemical Index (IPEX). Download the free tabular data and a chart of the historical index