- ABN Amro rises on first day of Amsterdam trading after IPO
- Barclays leads banks lower as Morgan Stanley cuts rating
European stocks rose for a second day, extending a three-month high, amid investor optimism about global growth, while gains in health-care companies helped offset declines in banks.
AstraZeneca Plc led drugmakers higher with a 1.6 percent advance. ABN Amro Group NV climbed 3.4 percent on its first day of trading in Amsterdam after an initial public offering. Glencore Plc fell 1.8 percent as miners erased earlier gains. Barclays Plc led lenders lower, falling 3.5 percent after Morgan Stanley cut its rating to equal weight, citing risks to consensus earnings estimates.
The Stoxx Europe 600 Index rose 0.2 percent to 381.78 at the close of trading. Shares have rebounded 13 percent since a September low amid optimism that the European Central Bank will add to stimulus measures. President Mario Draghi today reinforced this view, saying the ECB will do what’s necessary to raise inflation toward its target. Stocks posted a 3.3 percent weekly advance, after Federal Reserve minutes indicated the U.S. economy can withstand higher borrowing costs, while officials reiterated that increases will be gradual.
“Higher interest rates are now being viewed positively,” said Patrick Spencer, equities vice chairman at Robert W. Baird & Co. in London. “The interest rate hike is coming because the economy is performing better than expected, and if that’s the case, that bodes well for equities in general.”
Among other shares moving on corporate news, Imperial Tobacco Group Plc rose 1.8 percent on speculation that British American Tobacco Plc is arranging financing to make a bid. K+S AG fell 1.2 percent after Credit Suisse Group AG downgraded the German potash producer to underperform, similar to sell, from neutral, after cutting its price estimates for the commodity.
A gauge of energy companies posted the biggest decline of the 19 industry groups on the Stoxx 600 amid falling oil prices, with Royal Dutch Shell Plc and BG Group losing at least 1.7 percent.