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Europe: Shares climb as Glencore, Arcelor lift mining stocks
[LONDON] European shares rose on Monday, with Glencore and ArcelorMittal pushing up mining stocks and French economic data lifting the Paris stock market.
The pan-European FTSEurofirst 300 index rose 2.2 per cent. The euro zone's blue-chip Euro STOXX 50 index advanced 2.5 per cent.
Lisbon's benchmark PSI-20 index rose 1.9 per cent after Portugal's centre-right government on Sunday won an election, albeit without a majority.
France's CAC gained 2.7 per cent after data showed that French services activity accelerated in September more than previously thought.
German potash producer K+S slumped 20 per cent, however, after Potash Corp withdrew its bid for K+S.
Carmaker Volkswagen fell around five per cent to four-year lows. Credit default spreads on VW jumped, another effect of the car maker's admission it cheated on diesel emissions tests in the United States.
Glencore extended its rebound from a sell-off a week ago, rising around 10 per cent on Monday after a surge in its Hong Kong-listed shares. The company said it knew of no reason for the swings.
Some traders said Glencore's shares were buoyed by talk the company might sell some of its agricultural assets to cut its debt. "Sentiment is improving towards Glencore on the signs that it may be able to sell some of its assets," said Thames Capital Markets' trader Nav Banwait.
Gains by steelmaker ArcelorMittal also helped mining stocks. ArcelorMittal rose 5 per cent after Citigroup raised its rating on the stock to "buy" from "sell".
European stock markets remain below the peaks for 2015 reached around April. Concern China's economy was slowing pulled them lower in the last quarter.
Germany's DAX, which rose 2 per cent on Monday, remains some 20 per cent below a record high reached in April. Overall sentiment remains "neutral", said Peregrine & Black senior sales trader Markus Huber.