BARC says no new capital needed; jumps 73 percent

European equities markets made gains Monday after Barclays Bank (LSE: BARC; NYSE: BCS; TYO: 8642) said it will not need to raise more capital, as it will be able to absorb 2008’s writedowns with plenty of capital to spare.

In London, the FTSE 100 added 3.86 percent to 4,209.01 while the FTSE 250 gained 2.76 percent to 783.09.

Barclays Bank added 73.24 percent on its announcement, turning in the best performance of the session on the 100 by far, followed by Lloyds Banking Group (LSE: LLOY) with a gain of 32.25 percent as Royal Bank of Scotland (LSE: RBS; NYSE: RBS PRM) was up 19.83 percent.

The top five gainers on the 100 were rounded out by the insurance sector, as Old Mutual (LSE: OML; JSE: OLOML) added 10.51 percent and Aviva (LSE: AV) gained 14.11 percent.

Plumbing and heating supplies company Wolseley (LSE: WOS) was the worst performer on the 100, falling 29.72 percent after it issued a profits warning, while British Airways (LSE: BAY; NYSE: BAB) was down 8.48 percent after it said it will see losses in the 2008-09 fiscal year.

The FTSE Eurofirst 300 was up 2.97 percent to 783.09 while the IBEX added 2.48 percent to 8,375.2, the Dax was 3.54 percent higher to 4,326.87 and the CAC-40 gained 3.73 percent to 2,955.37.

Banks led the way on the CAC-40 as Dexia (Euronext: DX) added 9.32 percent, Credit Agricole (Euronext: ACA) was up 16.29 percent and BNP Paribas (Euronext: BNP; TYO: 8665) gained 16.93 and turned in the best performance on the Paris index, while Deutsche Bank (FWB: DBK; NYSE: DB) added 7.14 percent on the Dax.

The biggest gainer on the Dax was in the automobile manufacturing sector as Volkswagen (FWB: VOW) gained 9.56 percent, while among insurers Allianz (FWB: ALV; NYSE: AZ) was up 7.54 percent and Axa (Euronext: CS; NYSE: AXA) added 9.74 percent.

There were only 4 decliners on the CAC-40, led by tire maker Michelin (Euronext: ML) with a delcine of 2.7 percent.

Most equities markets in the Asia-Pacific region were closed to observe the Lunar New Year, but Tokyo’s markets remained open.

The Topix index was at a three-month low, closing down 0.68 percent to 768.28, while the Nikkei 225 fell 0.81 percent to 7,682.14 and the Mothers market dropped 1.99 percent to 323.09.

The construction machinery sector saw declines after Komatsu (TYO: 6301) dropped 4.7 percent as it reduced its profits forecast, citing declines in demand for its products, while Hitachi Construction Machinery (TYO: 6305) was also down, falling 3.9 percent on the session.

Consumer lenders dropped again, still reeling from recent a recent ruling in Japan’s Supreme Court which lengthened the time period during which borrowers can claim refunds for excessive interest payments.

Acom (TYO: 8572) was down 5.4 percent while Promise (TYO: 8574) dropped 6.9 percent.

Real estate investor Pacific Holdings (TYO: 8902) fell 17 percent after it said it would delay its quarterly earnings report.

Shippers, meanwhile, saw gains as demand grew for iron ore, with Nippon Yusen (TYO: 9101) adding 1.3 percent while Mitsui OSK (TYO: 9104) gained 28 percent.

Wall Street saw gains in early afternoon trade as the Dow Jones Industrial Average was up 0.78 percent to 8,140.64, the Nasdaq Composite had added 1.24 percent to 1,495.66 and the S&P 500 had gained 1.09 percent to 841.03.

Gains came on the news that drug maker Pfizer (NYSE: PFE) will buy rival pharmaceutical group Wyeth (NYSE: WYE) for $68 billion as the deal was taken as a sign that credit markets are starting to loosen up a bit.

Still, Pfizer dropped 9.4 percent at around 1:30 p.m. in New York, although Wyeth had added 0.57 percent at the same time.

Markets were also helped by an unexpected rise in existing home sales, as the National Association of Realtors said that sales of previously occupied homes were up 6.5 percent in December 2008 over the same month in 2007.

The banking sector was helped by Barclays Bank’s announcement that it will not need to seek new capital, with Bank of America (NYSE: BAC) adding 4.33 percent in early afternoon trade.

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