Global equities gain on positive news in Europe

PARIS - European stocks on Thursday rallied to the highest in 12 weeks after the region's leaders agreed to expand a bailout plan to halt the sovereign debt crisis. Asian shares and US index futures also rose.

BNP Paribas SA, France's biggest bank, and Deutsche Bank AG, Germany's largest, surged more than 8 percent as policymakers boosted the firepower of the European rescue fund to 1 trillion euros ($1.4 trillion).

PPR SA, the French owner of the Gucci luxury-goods brand, jumped 6.2 percent after third-quarter sales surpassed analyst estimates. Royal Dutch Shell PLC climbed after saying third-quarter earnings doubled.

"Some of the fear, which has been the dominant factor in the market, has been removed," said Pierre Mouton, a fund manager who helps oversee $7.5 billion at Notz Stucki & Cie SA in Geneva.

"Europe came to an agreement and has a plan. This allows financial stocks to rise because there is no longer the specter of nationalization. There is a sense of relief for the banking sector."

Futures on the Standard & Poor's 500 Index jumped 1.7 percent. The MSCI Asia Pacific Index surged 3 percent.

"A lot of details are still to come out," Ralph J. Silva Jr, a strategist at Silva Research Network in London, said on Bloomberg Television. "The overall perception I have is that it's positive. It's a very good start."

The US economy probably grew in the third quarter at the fastest pace this year as gains in consumer spending and business investment helped sustain a recovery on the brink of faltering, economists said. GDP rose at a 2.5 percent annual pace after advancing 1.3 percent in the previous three months, according to a Bloomberg survey of economists.

A gauge of banks in the Stoxx 600 index rose 5.5 percent, the biggest increase among the 19 industry groups in the measure. BNP climbed 11.9 percent to 33.63 euros. Deutsche Bank advanced 8.8 percent to 30.94 euros.

Societe Generale SA, France's second-largest bank, jumped 11.2 percent to 20.86 euros. The bank said in a statement on Thursday that it will meet mid-2012 capital requirements "through its own means".

The Stoxx 600 is trading at 10.6 times the estimated earnings of its companies, compared with the two-year low of 9.1 reached on Sept 23, according to Bloomberg data.

About half of the 108 companies in the Stoxx 600 that have released earnings since Oct 11 missed analyst profit estimates.

PPR advanced 6.2 percent to 117.30 euros. The company reported third-quarter sales that beat analysts' estimates and said it expects to report an improved full-year financial performance.

Revenue from continuing operations climbed 8 percent to 3.86 billion euros, the company said. Growth was 7 percent, excluding acquisitions, disposals and currency shifts.

BASF SE, the world's largest chemicals maker, rose 4.4 percent to 52.84 euros. The company reported third-quarter profit that beat analyst estimates as price increases and the purchase of cosmetic-ingredient maker Cognis helped limit a drop in margins.

Earnings before interest, tax and items such as costs from acquisitions and restructuring fell 11 percent to 1.96 billion euros, the company said. Analysts had predicted 1.85 billion euros, according to the average of 16 estimates in a Bloomberg survey.

Bloomberg News