25 June 2013 15:28 [Source: ICIS news]
LONDON (ICIS)--European chemicals stocks recovered in line with general markets on Tuesday as China’s central bank moved to calm investors fearing a liquidity crisis for one of the world’s largest economies.
Global markets suffered steep falls yesterday because of fears that the People’s Bank of China may refrain from stepping in to mitigate spiking interbank lending rates, fuelling fears of a credit crunch.
The central bank released a statement after markets closed in Asia on Tuesday, stating that it would take “appropriate measures” to maintain the overall stability of money markets.
Although the bank did not outline what those measures would be, the statement was enough to arrest the stock market rout, which had been exacerbated by fears of a wind-up of the USA’s quantitative easing programme.
Rumours that the bank would speak out that evening helped to mitigate a rollercoaster day of trading on Asian stock markets, with the Shanghai Shenzhen C SI 300 index falling by over 5% before rising to close 0.3% down compared with the previous day.
The UK’s FTSE 100 index was trading up 1.12% as of 14:12 BST, while Germany’s DAX bourse was trading up 1.67%, and shares on France’s CAC 40 index were up 1.61%.
The DJ Euro Stoxx chemicals index was trading up 1.51% compared with yesterday’s close, with gains posted for all but two of its constituent companies.
Shares in UK specialty chemicals company Elementis bounced back by 4.85% to recover all the value lost in Monday’s sell-off. Shares in Germany-based company LANXESS, which had also been hard-hit on Monday, rose by 3.25% compared with yesterday’s close.
Belgian chemicals company Solvay was trading up 2.54% compared with yesterday’s close, while shares in Germany’s Brenntag and Switzerland-based Syngenta were trading up 2.25% and 2.90% respectively.
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