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Europe: Shares end higher, led by banks, miners
[MILAN] European shares rose on Wednesday, with banks making their fifth straight day of gains after previously suffering heavy losses, while eyewear maker Luxottica led the losers after it trimmed its profit guidance.
The pan-European FTSEurofirst 300 index ended up 0.7 per cent at 1,341.88 points after a volatile day, helped late in the session by oil prices reversing initial losses which were triggered by a huge build in US crude stockpiles. "If oil traders shrug off the data then this would be a very bullish outcome for oil prices and indeed equity markets," Gain Capital analyst Fawad Razaqzada said in a note.
European stock markets slumped at the start of 2016 on concerns about a slowdown in China, the world's second biggest economy, and worries surrounding the impact of low central bank rates and poor growth on banks' profitability.
The FTSEurofirst, which had also risen in the last four sessions, is still down 7 per cent in the year to date.
Bank stocks, the worst performers so far this year, rose 3.4 per cent after ECB executive board member Benoit Coeure said the central bank was aware of concerns that ultra-low rates may put pressure on bank margins.
Some investors viewed the remarks as a sign the European Central Bank, which holds a polcy meeting next week, could put in place pro-bank measures.
Credit Suisse, Santander and UniCredit were all up by between 4.2 per cent and 5.5 per cent.
Shares of miners rose 3.7 per cent as metals prices rallied on signs of a recovery in the Chinese property market following Beijing's announcement this week it would cut bank reserve requirements and make other structural reforms.
Anglo American advanced 6.7 per cent and steelmaker ArcelorMittal 7.6 per cent.
Luxottica fell 4.7 per cent, topping losers on the FTSEurofirst, after the world's biggest eyewear maker trimmed its outlook and said it would not pay a special dividend.
JP Morgan also cited governance uncertainty at Luxottica after it appointed a close associate of the company's founder and chairman Leonardo Del Vecchio to the board.
ITV fell 3.5 per cent, as the television and media group's cautious outlook offset more positive factors such as higher earnings and a special dividend payout.