- Lenders post biggest three-day advance since July 2012
- Shares rise further as Draghi says ready to respond to turmoil
European stocks capped their biggest three-day advance in almost 10 months amid optimism Britons will vote to stay in the European Union in Thursday’s referendum and as the euro fell.
The Stoxx Europe 600 Index added 0.7 percent at the close. The benchmark extended gains as the euro dropped after Mario Draghi said the European Central Bank has plans in case the Brexit vote sparks turmoil that threatens the region’s outlook. Lenders posted the biggest three-day advance in almost four years.
Stocks have climbed 5.8 percent in three sessions after surveys showed the U.K. campaign to stay in the EU is gaining ground. While newer polls have been split on the outcome of a referendum, betting shops are placing the odds for “Remain” at about 80 percent, according to Oddschecker data. They see only a one-in-four chance of a secession.
“Right now the correlation between the implied odds for Brexit and the stock market move is pretty strong,” said Ralf Zimmerman, a strategist at Bankhaus Lampe in Dusseldorf, Germany. “We had seen a big jump yesterday on the back of Friday’s upwards move. Right now all eyes are on Brexit, on yes or no, and the market is trading on all the pieces of information geared on this issue.”
Shares began an advance on Friday, after sliding for six of the previous seven sessions, as Brexit concern eased amid a suspension in campaigning following the murder of Labour Party lawmaker Jo Cox. The Stoxx 600 has struggled to maintain momentum after rallying 16 percent from a February low to an April 20 high. It’s down 2.1 percent in June, on track for its first monthly drop in four.
Among stocks active on corporate news, Whitbread Plc gained 1.7 percent after comparable sales at Costa Coffee shops and Premier Inn budget hotels beat analyst estimates. Senior Plc tumbled 13 percent after the engineering firm said it sees lower revenues for its Flextronics division in the second half of the year.