European shares rise early, led by cyclicals

European shares rise early, led by cyclicals
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First Published: Mon, Apr 06 2009. 02 41 PM IST
Updated: Mon, Apr 06 2009. 02 41 PM IST
London: European shares rose on Monday morning, tracking strong gains in Asia and a late rally in the United States on Friday, as optimism for economic recovery grew, sending commodities stocks higher.
At 0830 GMT, the FTSEurofirst 300 index of top European shares was up 1.6% at 783.97 points at the start of a week shortened by the Good Friday holiday.
The index has risen 21% since hitting a record low of 9 March, and is now down just 5.8% for 2009.
“Bulls are putting their heads above the parapet on the basis that the global economy appears to be getting past the bottom, but the next test will be how robust earnings are,” said Richard Hunter, head of equities at Hargreaves Lansdown.
Banks were among early gainers. Banco Santander, Barclays, Credit Suisse, Societe Generale and UniCredit rose between 1.4 and 3.6%.
HSBC rose 4.6% after its massive rights issue received a robust response from investors.
Insurers Legal & General, Prudential, Swiss Re and Zurich Financial rose between 3.2 and 6.1%. Across Europe, Britain’s FTSE 100, Germany’s DAX and France’s CAC-40 were up between 1.4 and 1.8%.
Oil stocks rose, with crude rising more than 90 cents to more than $53 a barrel.
ENI, BP and Statoil rose between 0.9 and 2%.
Most miners rose, as copper prices hit five-month highs. Anglo American, Antofagasta and Xstrata were up between 2.1 and 6.8%.
But Rio Tinto was down 2.3% on reports it is planning an $8 billion rights issue.
Pharmaceuticals were among the few losers, with GlaxoSmithKline, Novartis and Sanofi-Aventis down between 1 and 1.2%.
Citigroup said in a note that cyclicals were rallying but cautioned against overoptimism.
US stocks rose on Friday, with the Dow marking its best four-week winning streak since 1933, lifted by robust results from Research in Motion and comments by Fed chairman Ben Bernanke, who said the central bank would do everything it could to stabilise banks. Asian shares climbed to a six-month high on Monday.
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First Published: Mon, Apr 06 2009. 02 41 PM IST
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