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Euro bailout boosts FTSE investors

Euro bailout boosts FTSE investors

Category: Investments

Updated: 10/05/2010
First Published: 10/05/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Stock markets around Europe have enjoyed a welcome boost, after a deal was agreed aimed at preventing the Greek debt crisis spreading to other countries.

The UK's flagship index, the FTSE 100, was up almost 5% at 5,372 at 2pm today, while Germany's Dax index and France's Cac 40 both surged higher.

Investor confidence returned after EU finance ministers decided the 16 members of the euro should have access to a 500 billion euro loan guarantee.

Concerns that other countries could face similar problems to those experienced by Greece had hit both the strength of the euro and global stock markets during the past few weeks.

At the close of trading last Friday, the FTSE had slumped to 5,123, a drop of more than 12% on the peak of 5,825 reached just over three weeks earlier.

The anticipation of the hung parliament, which became a reality following the election, coupled with fears over the potential impact of the problems witnessed in Greece, had sent the index into freefall.

The euro and the pound both strengthened following the deal.

The news comes shortly after it was revealed investors had continued to tread carefully in the early stages of 2010.

Cautious managed funds were deemed to be the best investments by investors, having dominated sales on the Cofunds investment platform in the first quarter of the year.

The sector attracted almost a third of net retail sales across the platform, while global growth funds also enjoyed a positive start to the year, attracting 6.4% of sales, compared with 3.7% in the previous quarter.

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