World Economy

Energy, Banking Stocks Boost European Shares

Energy, Banking Stocks Boost European SharesEnergy, Banking Stocks Boost European Shares

European equities climbed to a four-week high on Wednesday, with energy shares rising on the back of a rally in oil and Greek banks gaining after politicians made progress on talks over securing a debt relief deal.

However, British retailer Marks & Spencer slumped after saying that its turnaround plan would hit profits in the short term, CNBC reported.

The FTSEurofirst 300 was up 0.9%, having hit its highest level since late April and adding to the previous session’s jump of more than 2%. The STOXX Europe 600 index was also up 0.9%.

Energy shares were in demand after oil prices pushed closer to $50 a barrel, with US crude hitting its highest in more than seven months after industry data suggested a larger-than-expected drawdown in US crude inventories last week.

The STOXX Europe 600 Oil and Gas index rose 1.5%, helped by a gain of 3.5% and 1.1% respectively in BP and Royal Dutch Shell.

Greek shares rose 1.3% after eurozone finance ministers agreed with Greece and the International Monetary Fund on a deal that will address Athens’ requests for debt relief.

Greek banks were up about 1%, while the European banking index rose 2%. Shares in Alpha Bank, Eurobank Erasias, Caxiabank and Deutsche Bank rose between 1.8% and 4.4%.

In Asia, MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.8%, their best one-day gain since late March. Japan’s Nikkei closed up 1.6% as exporters got a boost from a weaker yen.

Hong Kong’s Hang Seng index gained 2.4%, but China shares surrendered early gains and slipped into the red amid concerns about sluggish growth in the world’s second-largest economy.

Policy sensitive two-year US notes were yielding 0.92 after rising to a 10-week high of 0.93%, and upbeat US home sales supported the view that the economy there at least may be strong enough to deal with a rise in rates.

The dollar was steady against a basket of currencies, close to a two-month high.

Many emerging market currencies felt the dollar’s heat but the Turkish lira jumped 1.6% off near four-month lows on Tuesday after investor-friendly deputy prime minister, Mehmet Simsek, kept his post in the government.

US crude futures rose 1.3% to $49.25 per barrel, having hit a 7-1/2-month high of $49.45. Brent crude futures gained 1.3% to $49.24 per barrel.