02 January 2013 13:15 [Source: ICIS news]
LONDON (ICIS)--European chemical stocks received a boost on Wednesday following a deal in the US to avoid a raft of tax hikes and spending cuts that had been set to come into effect at the start of 2013.
The US House of Representatives approved a bill late on Tuesday night to delay $109bn (€82.8bn) in spending cuts for two months, as well as extending existing middle-class tax cuts and tax credits for working families. The bill also raises taxes for the wealthy.
US President Barack Obama said: “This agreement will also grow the economy and shrink our deficits in a balanced way – by investing in our middle class, and by asking the wealthy to pay a little more.”
The general rally in European markets following the delay of the spending cuts and tax hikes, dubbed the “fiscal cliff”, pushed the UK’s FTSE 100 index above 6,000 for the first time in 17 months. As of 12:25 GMT the bourse was up 2.24% since markets opened on Wednesday.
Germany’s DAX index rose by 2.18%, while France’s CAC 40 index was up by 2.34%.
The Dow Jones Euro Stoxx Chemicals index was up by 1.28% as of 12:27 GMT, while nearly every company on the index enjoyed a rally in morning trading. The strongest share price increases were for French specialty chemicals company Arkema, which was trading up by 3.66%, and German giant BASF, which was trading up 2.78% from the previous close.
Shares in Dutch specialty chemicals and coatings producer AkzoNobel were up 2.52% from the previous close, and UK specialty chemicals manufacturer Elementis was trading up 2.37%.
($1 = €0.76)
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