Bank Shares Lead European Markets Higher
June 26 2017 - 3:08AM
Dow Jones News
By Christopher Whittall and Kenan Machado
Global stocks moved higher Monday as a stabilization in oil
prices and gains in European banking shares supported equity
markets.
The Stoxx 600 rose 0.6% in early trade after Asian markets
broadly advanced. U.S. futures pointed to a 0.2% opening gain for
the S&P 500.
Investors scooped up European banking stocks after Italian
authorities said Sunday they were prepared to spend as much as
EUR17 billion as part of the shut down of two regional banks.
Italian banks have been a concern for years, weighed down by
about EUR200 billion in bad loans, low profitability and
insufficient capital. Their troubles have cast a shadow over the
wider European banking system, which accounts for a large chunk of
regional equity benchmarks.
The Stoxx Europe 600 Banks subindex was up 0.9% recently, while
the FTSE Italia All-Share Banks was up 2.5%. Intesa Sanpaolo SpA
rose 3.5%, while UniCredit SpA gained 2.3%.
European food and beverage shares logged strong gains, rising
2%, following news that billionaire activist investor Daniel Loeb's
Third Point LLC hedge fund has taken a $3.5 billion stake in Nestlé
SA. Shares in Nestlé were up over 4%.
Gains in oil prices also added to the positive tone in markets
on Monday. Investors have eyed warily a sharp slide in energy
prices in recent days.
U.S. oil prices entered a bear market last week after falling
more than 20% since a recent February high amid a persistent glut
in crude prices despite moves to limit production from the
Organization of the Petroleum Exporting Countries.
In early 2016, a sharp decline in oil prices pushed down major
stock indexes as investors worried about the knock-on effects of
rising defaults in the energy sector. The energy market is also
crucial for the earnings recovery in the U.S., where the sector is
expected to account for nearly half of the S&P 500's earnings
growth in the second quarter, according to FactSet.
Brent crude oil, the international benchmark, rose 1.4% Monday
to $46.18 a barrel. The Stoxx Europe 600 Oil and Gas subindex rose
0.9%.
In Asia, the Shanghai Composite index rose 0.9%, with Chinese
stocks continuing to perform strongly following MSCI's decision to
add them to its indexes. Gains there also helped boost Hong Kong
equities on Monday. The Hang Seng Index rose 0.7%.
Meanwhile, Taiwan's tech-heavy Taiex index rose 1.3% to hit
fresh 27-year highs.
In Japan, the Nikkei Stock Average rose 0.1%, with financial
stocks weighing on the broader index. Signs that interest rates
will remain low continue to weigh on Japanese financials, said
Hisao Matsuura, chief strategist for equities at Nomura Japan.
The yield on the 10-year Treasury note edged up to 2.152% from
2.146% on Friday. Yields rise as prices fall. Investors are looking
ahead to a raft of inflation data out of Europe and the U.S. this
week.
In currency markets, the WSJ Dollar Index, which measures the
dollar against a basket of 16 currencies, declined 0.1%.
Write to Christopher Whittall at christopher.whittall@wsj.com
and Kenan Machado at kenan.machado@wsj.com
(END) Dow Jones Newswires
June 26, 2017 03:53 ET (07:53 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Intesa Sanpaolo (BIT:ISP)
Historical Stock Chart
From Mar 2024 to Apr 2024
Intesa Sanpaolo (BIT:ISP)
Historical Stock Chart
From Apr 2023 to Apr 2024