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Europe: Oil and mining strength helps stocks shrug off trade rhetoric

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[LONDON] Robust oil and mining stocks drove European shares up on Wednesday as investors shrugged off a weaker session in Asia amid rising tensions between the United States and China.

The pan-European STOXX 600 and eurozone STOXX were both up 0.2 per cent by 0726 GMT, despite sharp falls in Asian stocks after US President Donald Trump said the United States is taking a "tough stance" with China on trade.

Oil stocks rose 1.2 per cent after crude prices climbed thanks to falling US crude inventories, while miners climbed 1 per cent.

Individual stocks posted big moves triggered by results and M&A speculation.

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Dutch biotech firm Galapagos soared 16.2 per cent to the top of the STOXX after positive trial results for its filgotinib drug to treat rheumatoid arthritis.

British energy provider SSE sank 8.5 per cent after it warned first-half profit would halve compared with last year, calling its financial performance "disappointing and regrettable".

Peer Centrica also fell 3.1 per cent.

Shares in Zara owner Inditex meanwhile rose 2 per cent to the top of Spain's IBEX after the fashion retailer said it expected profit margin growth in the second half.

Salvatore Ferragamo topped Italy's FTSE MIB with a 4.3 per cent rise, after traders cited rumours about a potential M&A deal.

The family that controls the fashion group is not interested in selling its stake, a spokeswoman for the group said.

Hexpol shares rose 3.9 per cent after the Swedish chemicals firm said it acquired US rubber compounder Kirkhill Rubber.

Broker research also moved some stocks. German utility E.ON fell 3.5 per cent to the bottom of the DAX after Morgan Stanley analysts cut their target price on the stock. (Reporting by Helen Reid, editing by Louise Heavens)

REUTERS