European shares rose for a third straight session on Tuesday to hover near recent 11-month highs, boosted by stronger commodity prices on the back of gold rising above $1,000 an ounce and crude trading over $69 a barrel. At 0847 GMT, the FTSEurofirst 300 index of top European shares was up 0.5 percent at 980.59 points.
The index, which slumped 45 percent in 2008, is up 17 percent this year and has jumped 51 percent since falling to a record low in March. European shares jumped on Monday, boosted by Cadbury, which surged more than 40 percent on a $16.7 billion bid by North America's Kraft Foods. Cadbury rejected the offer, but Kraft Foods said it was intent on pursuing.
Mining shares were among top gainers on the index as spot gold rose above $1,000 an ounce for the first time since February, copper rose 0.6 percent and aluminium advanced 0.8 percent. BHP Billiton, Anglo American, Antofagasta, Rio Tinto, Xstrata and ENRC rose 0.7-1.9 percent.
Energy shares tracked crude oil prices, which rose 1.6 percent. BP, BG Group, Tullow Oil, Repsol, Total and StatoilHydro added 0.2-1.3 percent. Across Europe, Britain's FTSE 100 index, Germany's DAX and France's CAC 40 rose 0.4-0.6 percent. Banks were mixed, with Standard Chartered, Barclays, Lloyds , Royal Bank of Scotland and Natixis gaining 0.1 to 2.9 percent. But HSBC, BNP Paribas, Societe Generale and Credit Agricole fell 0.2-1.3 percent. Some analysts said the equity market has rallied in the past months and could not keep rising at the same pace.
"You will have to surprise the market with even more stronger figures." In market news, Deutsche Telekom and France Telecom have launched exclusive talks to merge their British mobile units in a joint venture that would grab the top spot in the cut-throat UK market.
Deutsche Telekom was up 1.9 percent, while France Telecom rose 2.8 percent. British defence giant BAE Systems is fighting a decision by the United States army to award a multi-billion dollar vehicle contract to a competitor, saying it did not judge its proposals fairly. Its shares were flat. Kingfisher rose 2.4 percent after Europe's biggest home improvement retailer said it expected to report an underlying pretax profit of 285 million to ($550.4 million) to 290 million pounds for the six months to August 1.
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