AlHijjah 7, 1432, Nov 3, 2011, SPA -- European shares rose strongly on Thursday, boosted by the European Central Bank cutting interest rates and optimism that Greece will scrap plans for a referendum on its bailout package, easing worries it may leave the euro, according to Reuters. Strategists said more evidence of growth was needed if a rally was to be sustained. The FTSEurofirst 300 index of top European shares rose 1.9 percent to close at 990.11 points. "The ECB decision is more important than any of the political decisions taken today," said Andrew Milligan, head of global strategy at Standard Life Investments, part of the Standard Life Group, which administers 196.8 billion ($315 billion) pounds of assets. "It's welcome news they've realised the difficult situation facing European economies." He added that the rate cut was a "necessary but not sufficient" condition for more confidence in the equities market, and more measures were needed to boost growth. The ECB cut its main interest rate by 25 basis points to 1.25 percent as the euro zone's escalating debt crisis eclipsed worries over persistently high inflation. Stocks rose across the board, and euro zone banks were among the standout gainers, up 3.3 percent. France's BNP Paribas rose 7.5 percent, having said in its third-quarter results statement it had cut its exposure to Greece, Italy and Spain by more than 12 billion euros ($16.6 billion). Several companies helped to boost their shares further with corporate updates. Other financials to rise included ING , up 9.4 percent, after beating forecasts with third-quarter results, though the Dutch company took a hit from Greek bonds and said it will cut 2,700 jobs, in the face of deteriorating markets. Political developments in Greece remained at the forefront of investors' minds. Greek Finance Minister Evangelos Venizelos called on the Greek government to categorically rule out a referendum on a crucial bailout plan and do everything to implement the deal. Greek banks rose 8.7 percent. "The markets have, perhaps paradoxically, been reassured by events in Greece," Milligan said. "The feeling is there will be a resolution in the near future. Bear in mind the utter disaster that leaving the euro would be. The Greek population will eventually have to accept the austerity plan." The shock announcement of the referendum had caused shares to fall sharply earlier in the week. -- SPA
