WEEKLY UPDATE – Federal Reserve “spiced things up” as it unexpectedly hiked the interest rate it charges for emergency loans.

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Swedish stocks dived Friday morning after the US Federal Reserve unexpectedly hiked the interest rate it charges banks for emergency loans. During the afternoon stocks rose after the US consumer-price index showed that the cost of living rose in January less than anticipated and a measure of prices excluding food and fuel fell for the first time in 28 years.

"The Federal Reserve certainly managed to spice things up a little after the US close last night with that surprise move to raise the discount rate" IG Markets analyst Ben Potter told AFP. "This will doubtless stimulate the debate as to which central bank will move next, although it's worth stressing that this change affects the discount as opposed to the (Fed) Funds rate."

The OMX Stockholm 30 index closed up 1.09 percent Friday. It was up 1.44 percent compared a week earlier.

Scandinavian airline SAS rose 6.60 percent Friday after its largest owners, the Swedish and Norwegian states, said they look to sell their stakes in the loss-making company.

Swedish-Swiss ABB shares gained 7.6 percent Thursday after the engineering giant said fourth-quarter profit more than doubled. The group also recommended a six percent increase in its dividend payment to shareholders.

Shares in Sweden’s second-largest telephone company Tele2 declined Thursday after the company said its chief executive officer Harri Koponen would leave following “irreconcilable differences over leadership.”

Lundin Petrolium shares dived Wednesday as fourth-quarter production and earnings were below expectations. "Cash flow remains below the company's total expenditure," said S&P; in a comment to the report.

Shares in Handelsbanken, which are up more than 130 percent from a year earlier, were largely steady after the bank Thursday reported a profit slump in the fourth quarter but did better than expected.

Communication intelligence firm Cision said Monday its 2009 revenues decline 17 percent, sending shares down almost 16 percent.

Since the turn of the year the OMX Stockholm 30 index is up 0.58 percent.

This article has been published at The Swedish Wire and Nasdaq OMX Nordic.