Miners Lead Europe Stock Gains While Siemens Surges on Earningsby
Commodity producers lead gains among Stoxx 600 industry groups
Peripheral banks rebound, though Monte Paschi down second day
A rebound in commodity and energy producers led the advance in European equities, while earnings at Siemens AG and Royal Philips NV further boosted sentiment.
The Stoxx Europe 600 Index climbed 0.9 percent at the close of trading in London. It erased a decline of as much as 2 percent as crude rose above $30 a barrel after Iraq’s oil minister said Saudi Arabia and Russia are now more flexible about cooperating to cut output.
Siemens surged 8.6 percent -- the most since 2008 -- after unexpectedly raising its annual profit forecast, signaling confidence that it can ride out a slowdown in China and drop in oil. Philips jumped 6.1 percent after reporting that quarterly earnings rose more than estimated on growth in medical equipment.
“Corporate news stabilized stock prices as well as oil,” said Ralf Zimmermann, a strategist at Bankhaus Lampe in Dusseldorf. “Oil and stocks are reacting on the same fears and the same hopes.”
Fluctuations in oil have been weighing on stocks worldwide as the two asset classes have become the most correlated since 2013. Crude’s decline on Monday halted the Stoxx 600’s biggest two-day rebound since 2011, fueled by speculation of more European Central Bank stimulus.
The advance on Tuesday helped the Stoxx 600 trim its monthly loss to 7.3 percent, which would be its worst start to a year since 2008. A measure of stress in the market has risen 27 percent in January and reached its highest level since September last week.
Among other stocks moving, TalkTalk Telecom Group Plc surged 6.8 percent after a report that Iliad SA is looking into entering the U.K. market. EasyJet Plc fell 3.2 percent after posting revenue that missed estimates. Deutsche Post AG lost 2.7 percent after Credit Suisse Group AG cut its recommendation on the stock to the equivalent of a sell from a buy, citing threats from Amazon.com Inc.’s expansion in Germany and currency headwinds.