LONDON (AFX) - The euro extended its gains, finding a firm footing above 0.93 usd level in midday trade, underpinned by evidence that portfolio and direct investment flows are now in favour of the single european currency, dealers said. Today's euro zone current account balance was a significant development, said Kamal Sharma, economist at Commerzbank. "For the first time since November 2001, there is a combined net inflow of direct portfolio investment flows," he said. The European Central Bank revealed that direct investment in the euro area saw a net outflow of 5.9 bln eur in March, whereas portfolio investment registered net inflows of 8.1 bln eur. "It appears that the market is throwing in the towel on US assets, and particularly equities," said Sharma. One often cited reasons for the euro's prolonged weakness has been the record amounts of outflows heading into the US assets market, he said. "That pressure has now started to ease and we should see the euro better supported," said Sharma. "We are looking for the euro to consolidate at these levels," he said. The euro was already perking up before the data but the market was looking for excuses to sell the dollar and found the justification it wanted, said Jeremy Hawkins, economist at Bank of America. The capital flows numbers tend to be erratic but suggests that investor sentiment towards the euro at the end of the first quarter has improved, said Hawkins. Sterling was weaker against the euro, tracking the dollar lower. "Euro-sterling is quite strong because the pound has been led down by the dollar," said Hawkins. With little by way of US economic data this afternoon, the focus will be on stock market developments, dealers said. They said a negative performance on stock markets will keep the dollar under pressure, while a rebound may offer the dollar some support. "The forex market will be looking at alternative markets for guidance," said Hawkins.