European Shares Post Biggest Advance in a Month; UniCredit Jumps

Euro Area PMI Strengthens, Pound Uncertainty Lingers
  • Novartis gains after U.K. authority backs cancer treatment
  • Ladbrokes surges on provisional go-ahead for Coral takeover

European shares rose the most in a month as investors shrugged off concerns that a Federal Reserve rate increase as early as June will derail the U.S. economic recovery.

Novartis AG climbed 1.8 percent after the U.K. affirmed its backing of a cancer treatment, helping a measure of health companies post the best performance of the 19 industry groups on the Stoxx Europe 600 Index. UniCredit SpA added 7.6 percent, leading gains among banks, after people familiar with the matter said it may sell a stake in its online broker FinecoBank SpA and review holdings in Poland and Turkey to raise capital.

The Stoxx 600 increased 1.2 percent to 338.01 at the close of trading, for a weekly gain of 1 percent. Shares slid the most in two weeks yesterday as commodities tumbled and minutes from the Fed’s last meeting showed officials are ready to raise interest rates next month if the economic pickup stays supportive.

“After the losses of the last few days, bargain hunters are re-entering the market,” said Thorsten Engelmann, a Frankfurt-based trader at Equinet Bank.  “The market seems to be able to deal with the Fed raising rates, and next week should be quieter now that the earnings season is over.”

A European stock rally from a February low has stumbled since reaching a three-month high in April amid concerns about global-growth prospects, mixed earnings reports and the efficacy of central bank policies. While gains in banks pushed the Stoxx 600 to its highest level since May 2 on Wednesday, before today the gauge had gone a month without posting a daily gain of at least 1 percent. It’s still down 3.6 percent since its recent peak.

Ocado Group Plc and J Sainsbury Plc advanced 3.5 percent or more, leading retailers higher. Energy companies rose as crude headed for a second weekly gain.

Among stocks moving on corporate news, Ladbrokes Plc jumped 6.5 percent after the U.K.’s competition watchdog said the company and Coral Group may have to sell as many as 400 shops to get approval for a merger that would create Britain’s biggest betting-shop chain. The number was well short of some of the most pessimistic predictions.

Aberdeen Asset Management Plc rose 2.3 percent, the most in more than a month, after its chief executive officer said it plans to remain independent despite takeover interest from competitors. 

Cie. Financiere Richemont SA slid 4.3 percent to its lowest price since October 2012 after the maker of Cartier jewelry and IWC Schaffhausen timepieces forecast a difficult first half after sales plunged 18 percent in April. Rival Swatch Group AG dropped 2.8 percent to its lowest since July 2010.

Greece’s ASE Index added 2.8 percent, for the biggest gain among western-European exchanges, as the International Monetary Fund proposed that the Mediterranean nation shouldn’t make payments on its European bailout loans until 2040.

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