Frankfurt's DAX hits highest point in four years

4th January 2006, Comments 0 comments

4 January 2006, FRANKFURT - Signs that the cycle of interest rate hikes in the U.S. is drawing to a close helped to propel European stocks higher Wednesday with the Frankfurt stock exchange hitting its highest level in more than four years.

4 January 2006

FRANKFURT - Signs that the cycle of interest rate hikes in the U.S. is drawing to a close helped to propel European stocks higher Wednesday with the Frankfurt stock exchange hitting its highest level in more than four years.

In early morning trading, Frankfurt's key DAX index rose 0.73 per cent, breaching the 5,500 mark for the first time since August 2001.

The positive mood was reflected across the rest of Europe with the Euro Stoxx 50, which measures leading stocks in the 12-member eurozone, climbing 0.4 per cent.

Apart from Tuesday's release of U.S. Federal Reserve minutes, which played down the prospects of further rate increases, this week's strong showing by European stocks came in the wake of growing optimism about the outlook for Europe's economy.

That sentiment has been reinforced by a series of solid earnings reports by European corporations in 2005, helping to underpin stocks in European companies with strong links to U.S. markets.

Shares in Germany's electronics giant Siemens AG, which achieves a large share of its turnover in the U.S., gained 2.2 per cent in pre- midday trading.

DPA

Subject: German news

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