19 Jan 2009
Jan. 19 (Bloomberg) -- European stock-index futures rose on speculation government efforts to prop up the ailing banking system will shore up confidence in the industry.Barclays Plc may be active. The U.K. government said it will set up a 50 billion-pound ($66.6 billion) program to buy banks' toxic assets. Land Securities Group Plc may climb after UBS AG advised clients to buy the stock.
"The main focus will the U.K. banks as the government announces these measures," said Matt Buckland, senior trader at spread betting firm CMC Markets in London. "All the direction will be coming from the banks."
Futures on the Dow Jones Euro Stoxx 50 Index, a benchmark for the euro region, added 19, or 0.8 percent, to 2,310 at 7:17 a.m. in London. The U.K.'s FTSE 100 Index is set to open 66 points higher, according to IG Markets. Stock markets in the U.S. are closed today for the Martin Luther King Jr. holiday.
Europe's Stoxx 600 is poised to rise for a second day following its seven-day tumble as companies from Deutsche Bank AG to Alcoa Inc. fueled concern earnings will deteriorate, dragging the gauge 10 percent lower.
The U.K. Treasury announced a new plan to guarantee and purchase banking assets and will reverse a policy of shrinking Northern Rock Plc, it said in a statement today. The government also will offer "capital and asset-protection" for banks in conjunction with other nations.
Denmark is also expanding its financial rescue package by advancing the country's banks and mortgage institutions 100 billion kroner ($17.8 billion) in loans as the government struggles to avert a protracted recession.
Barclays, Land Securities
Barclays, the U.K. bank that turned down government funding last year, said 2008 earnings will exceed analysts' forecasts and called its 25 percent share-price slump on Jan. 16 unjustified.
Land Securities might advance after UBS raised its recommendation on the stock to "buy" from "neutral," saying investors should look for a "maintained" dividend at Britain's largest real-estate investment trust.
E.ON AG and RWE AG, Germany's biggest utilities, may rise after Royal Bank of Scotland Group Plc rated the stocks "buy" in new coverage, saying "operational performance should remain healthy."
Cie. Financiere Richemont SA will probably be active after the world's largest jewelry maker said third-quarter sales declined 7 percent as customers in Europe and North America reduced spending on Cartier necklaces and Chloe fashions.
Deutsche Post AG will probably move after reporting operating profit of 2.4 billion euros ($3.2 billion) for 2008, slightly above its goal.
