European stocks closed sharply higher on Monday, led largely by gains in the bank shares, and on fairly good performance by stocks from several other sectors, as investors indulged in some brisk buying right through the session.
Data showing a notable increase in China's industrial profits in the month of August, and optimism about a potential new coronavirus relief package in the U.S. outweighed concerns about the surge in coronavirus cases and rising U.S.-China tensions.
Optimism about a new U.S. coronavirus bill has risen after House Speaker Nancy Pelolsi said a new package is still possible. House Democrats plan to unveil a new $2.4 trillion coronavirus relief bill. The price tag for the bill is $1 trillion less than a stimulus package the House passed back in May but may still be too high for Republicans.
Brexit trade talks are set to resume this week, with negotiators expected to discuss law enforcement and transport.
The pan European Stoxx 600 surged up 2.22%. The U.K.'s FTSE 100 ended 1.46% up, Germany's DAX climbed 3.22% and France's CAC 40 gained 2.4%, while Switzerland's SMI added 0.9%.
Among other markets in Europe, Austria, Belgium, Denmark, Finland, Greece, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain and Sweden ended stronger, with their benchmark indices gaining 1 to 4%.
Iceland ended modestly higher and Czech Republic edged up marginally, while Turkey closed weak.
In the U.K. market, HSBC shares climbed 10% after China's Ping An, the bank's biggest shareholder, raised its stake in the lender late last week.
Lloyds Baning Group surged up more than 7.7% and Royal Bank gained 7.5%. Barclays, Standard Chartered and Natwest Group also moved up by more than 7%.
Diageo surged up more than 6% after the company said it has made a good start to fiscal 2021, with sequential improvement in its performance across all regions.
Land Securities, British Land Company, Melrose, Standard Life Aberdeen, Legal & General, Ds Smith, TUI and Whitbread were among the other major gainers.
Among the losers, Rolls-Royce Holdings slid 3.6%, GVC Holdings ended nearly 2% down, while Kingfisher closed lower by 1.4%.
In Germany, Siemens rallied nearly 9%. Deutsche Bank gained about 7%, while Lufthansa, Infineon Technologies, BASF, HeidelbergCement, Continental, BMW, Volkswagen, MTU Aero, SAP, Beiersdorf and Munich RE gained 3.4 to 4.7%.
In the French market, ArcelorMittal spurted nearly 11% after Cleveland-Cliffs Inc. entered into a definitive agreement to buy the company's U.S. operations.
Renault gained more than 7%, while Credit Agricole, Accor, Societe Generale, Technip, Publicis Groupe, Peugeot, Airbus Group, Unibail Rodamco and Essilor ended stronger by 4 to 6%.
For comments and feedback contact: editorial@rttnews.com
Market Analysis