Germany's DAX index races through 10,000 mark for first time as ECB stimulus shores up markets

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By PAN PYLAS, AP Business Writer

LONDON (AP) — A raft of stimulus measures from the European Central Bank helped support markets Thursday but the momentum was kept in check by some profit-taking, particularly in Germany, ahead of key U.S. jobs data.

Initially, the ECB's package, which included interest rate cuts and a new liquidity program for the banking sector, was greeted with euphoria in European stock markets, especially in Germany where the DAX rose to a record high of 10,013.

However, that euphoria soon faded as investors in Germany raked in profits and some questioned whether the ECB package was as dramatic as initially thought. There was also some disappointment that ECB President Mario Draghi did not announce a program of quantitative easing, whereby the bank buys bonds in the markets. And the euro, which fell toward $1.35 was back up, trading 0.3 percent higher on the day at $1.3637.

"Stocks came off their best levels .... although this was most likely due to mild profit taking ahead of tomorrow's release of nonfarm payrolls data, and as the German DAX index hit that psychological resistance level of 10,000," said Fawad Razaqzada, a technical analyst at Forex.com.

In Europe, Germany's DAX ended up 0.2 percent higher at 9,947.83, having earlier hit a high of 10,013.69. France's CAC-40 sustained its gains, closing 1.1 percent higher at 4,548.73. Meanwhile, the FTSE 100 index of leading British shares was unaffected by the Bank of England's decision to keep its monetary policy unchanged, as expected. It closed 0.1 percent lower at 6,813.49.

In the U.S., the Dow Jones industrial average was up 0.6 percent at 16,836 while the broader S&P 500 index rose the same rate to 1,940.

Now that the ECB policy decision is out of the way, traders will be focusing on Friday's nonfarm payrolls data for May. The figures often set the market tone for a week or two after their release as traders assess the impact on the policy stance of the U.S. Federal Reserve.

Earlier in Asia, China's benchmark Shanghai Composite Index added 0.8 percent to 2,040.88 while Hong Kong's Hang Seng shed 0.2 percent to 23,109.66. Tokyo's Nikkei 225 added 0.1 percent 15,079.37.

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