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European Stocks Rally on Brexit Deal Optimism, Rebounding Oil Prices


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European equity benchmarks were higher on the penultimate trading day of the week amid optimism that Britain will be able to strike a deal with diplomats in Brussels that will open the gates to the start of trade negotiations before its departure from the shared currency union in 2019.

British ministers are 'optimistic' that a deal could be struck on the contentious issue of how Northern Ireland's border will be affected following Britain's departure from the European Union (EU) in March 2019, according to a BBC report published on Friday. If an agreement can be reached it will facilitate talks between Britain's Brexit negotiating team and Prime Minister Theresa May when EU ministers meet next week.

Oil prices were rebounding after sustaining sharp losses on Wednesday following the release of US inventory data which showed a fourth consecutive week of gains in motor gasoline stockpiles. West Texas Intermediate crude oil futures, the main US benchmark, were 0.5% higher at $56.23 per barrel while Brent crude, the international gauge, was up by 0.6% at $61.60 per barrel in recent trade.

In equities, British bookmaking company Ladbrokes Coral Group was leading the gainers on the pan-European Stoxx 600 Index, up by 24.8% after saying that it is in detailed discussions with gambling operator GVC after receiving an offer from GVC to acquire Ladbrokes for a total equity value of up to 3.9 billion pounds ($5.22 billion). Intrum Justitia, a provider of credit management services, and GVC followed, both up by 8.5%. DS Smith, a packaging company, was 4.1% higher after posting double digit growth in its operating profit and revenue in the first half of its fiscal year although pre-tax profit fell by 1% over the same period.

Automobile manufacturers and telecommunications stocks were also among the biggest gainers on Frankfurt's DAX and Paris' CAC-40 index. Volkswagen and Peugeot were 2.2% and 1.0% higher, respectively, on the German and French benchmarks. Deutsche Telekom and Paris-listed Orange were 1.2% and 1.6% higher, respectively.

Decliners on the Stoxx 600 index were led by retailer Steinhoff International, down by 29.6% two days after it announced an investigation into accounting irregularities and the resignation of its chief executive. Getinge AB Series B, a medical technology company, was down by 16.9% and online gaming company Playtech was 5.6% lower.

The pan-European Stoxx 600 Index was 0.24% higher, London's FTSE 100 Index was up by 0.28%, Frankfurt's DAX was 0.34% higher and Paris' CAC-40 was up by 0.31% at the time of writing.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.



This article appears in: Investing , Stocks
Referenced Symbols: DAX


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