European stocks rose to their highest level in more than six years, as mining companies advanced, and Sky Deutschland AG rallied after British Sky Broadcasting Group Plc said it’s in talks to buy the company.
A gauge of commodity producers jumped the most in almost seven months as JPMorgan Chase & Co. recommended buying shares in miners on signs of a recovery in Chinese demand. Sky Deutschland increased the most in more than two years. Logitech International SA added 6.8 percent as Credit Suisse Group AG advised buying the stock. Alstom SA added 2.8 percent after a report that Siemens AG may improve its offer for the company’s energy unit.
The Stoxx Europe 600 Index climbed 0.7 percent to 340.96 at the close of trading. The equity benchmark gained for the fourth straight week last week as European Central Bank President Mario Draghi said policy makers are ready to take action in June.
“Markets could be in for a little bit more smooth sailing in the next months,” said Allan von Mehren, chief analyst at Danske Bank A/S in Copenhagen. “Equities have underperformed other markets because correction risk was very high. Now the global economy is accelerating, central banks are dovish, companies are making acquisitions, and it’s hard to see what could keep the market down from here.”
The number of shares trading hands in Stoxx 600-listed companies was 16 percent lower than the 30-day average at this time of day, according to data compiled by Bloomberg.
Voters in Ukraine’s Donetsk and Luhansk regions backed plans to secede, Russia’s state-run RIA Novosti said late yesterday. The government in Kiev, the U.S. and the EU all said the referendums were illegal. The EU added two companies and 13 people connected to the unrest in Ukraine to its sanctions list today, an official said. Ukraine plans to hold presidential elections on May 25.
National benchmark indexes rose in 16 of the 18 western European markets today. The U.K.’s FTSE 100 advanced 0.6 percent and Germany’s DAX increased 1.3 percent. France’s CAC 40 added 0.4 percent as five companies traded without the right to their dividends, wiping 23.678 points off the index.
JPMorgan upgraded its rating on European mining companies to overweight from underweight, with strategists led by Mislav Matejka citing cuts to spending and costs, as well as improving demand from China. JPMorgan also named Rio Tinto Group and BHP Billiton Ltd as the most attractive stocks in the industry.
A gauge of European mining shares jumped 2.7 percent and prices for copper and base metals rose. BHP Billiton climbed 2.7 percent to 1,948 pence, Rio Tinto advanced 4.8 percent to 3,340 pence and Anglo American Plc rose 2.3 percent to 1,641.5 pence.
Sky Deutschland, which is controlled by Rupert Murdoch’s 21st Century Fox Inc., soared 9.9 percent to 6.97 euros. Murdoch, who owns about 39 percent of BSkyB (BSY), is working on a transaction valued at about 10 billion euros ($14 billion) to combine BSkyB with his holdings in Germany and Italy, people familiar with the matter said. BSkyB, which fell 2.4 percent to 868.5 pence, confirmed the discussions in a statement today.
Logitech, the world’s biggest maker of computer mice, advanced 6.8 percent to 11.85 Swiss francs. Credit Suisse raised its rating on the stock to outperform, similar to a buy recommendation, from neutral, after the shares fell more than 20 percent (LOGN) from a Feb. 12 high. The company’s sales and profit forecasts for its 2015 financial year are too low, according to Credit Suisse. Logitech predicts sales of $2.16 billion and $145 million in non-GAAP operating income.
Alstom rose 2.8 percent to 29.02 euros. Siemens, which is vying with General Electric Co. for Alstom’s energy assets, may offer to transfer its rail-signaling unit to Alstom Transport as part of an improved bid, Les Echos reported, citing two people familiar with the matter that it didn’t identify.
Air France-KLM Group added 4 percent to 10.73 euros. The number of passengers carried increased 1.8 percent in April to 6.7 million, helped by the late timing of Easter this year, the carrier said in a statement today.
Banca Popolare di Milano Scarl advanced 1.9 percent to 62 euro cents, paring earlier gains of as much as 8.1 percent. Italy’s oldest cooperative bank late Friday reported first-quarter net income of 64.4 million euros, beating the average analyst forecast of 55.4 million euros.
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