European stocks climbed for a second day as BNP Paribas announced plans to raise capital to help repay government funds and a US housing report added to evidence the recession is abating.
BNP Paribas added 3.3 per cent after France's largest lender announced a €4.3 billion rights offer. Siemens limited gains after Europe's biggest engineering company said it had a "tough" year.
Salzgitter slid 2.1 per cent as Germany's second-biggest steelmaker announced a convertible-bond sale. Europe's Dow Jones Stoxx 600 Index increased 0.5 per cent to 244.36 as of 2.53pm in London after swinging between gains and losses more than 20 times today.
The S&P/Case-Shiller home-price index showed home values in 20 US metropolitan areas declined less than forecast in the year ended in July, a sign the housing slump that led to the worst recession in seven decades is easing.
Equity indexes in the United States and Europe have rebounded more than 50 per cent since March, sending price-earnings valuations on the S&P 500 and the Stoxx 600 this month to the highest levels since 2004 and 2003, respectively.
BNP Paribas rose 3.3 per cent to €58.45 after the Paris-based lender said it will seek to raise capital to help repay the government. The bank is offering existing investors 107.6 million shares at €40 each, or 29 per cent below yesterday's closing price. BNP will repay €5.1 billion it received from the French state as well as €226 million of interest.
Siemens dropped 1.5 per cent to €65 after Chief Financial Officer Joe Kaeser told investors that the company had a "tough" year as orders for its factory equipment and lighting products fell, forcing Siemens to deepen job cuts and book charges.
Order bookings in the fiscal fourth quarter that ends tomorrow will fall about 20 per cent from a year earlier, he said.
Bloomberg