Mhh-Europe shares rise; DAX enjoys longest winning run in 18 mths

Wed Nov 26, 2014 7:39am EST

* FTSEurofirst 300 up 0.3 pct, moving in tight range

* DAX up for 10th consecutive session

* Seadrill sinks 16 pct after scrapping dividend

By Blaise Robinson

PARIS, Nov 26 (Reuters) - European shares rose on Wednesday, with Germany's blue chip index DAX advancing for the 10th straight session as investors bet on further monetary stimulus from the European Central Bank.

ECB Vice President Vitor Constancio said on Wednesday the bank might decide as early as the first quarter of next year whether to begin buying sovereign bonds. His remark fuelled expectations that the ECB could launch a quantitative easing programme early next year.

Gains in stocks were capped by a renewed drop in shares of oil services companies, however, with Norwegian offshore driller Seadrill sinking 16 percent.

The firm scrapped its dividend on Wednesday, becoming the latest oil services group to suspend its payout as the sector struggles with a slump in crude prices that is forcing oil majors to slash capital expenditure.

Shares in rival Fugro fell 3 percent, PGS shed 3.1 percent and Afren slid 2.4 percent.

At 1207 GMT, the FTSEurofirst 300 index of top European shares was up 0.3 percent at 1,393.04 points, trading in a tight range, while the DAX was up 0.7 percent, enjoying its longest winning streak since May 2013.

"Sentiment is bullish," Markus Huber, a senior trader at Peregrine & Black, said. "We're long the DAX because America has outperformed hugely and even though growth there is strong, it's already in the price whereas in Germany there's more to come."

Around Europe, Britain's FTSE 100 index was up 0.2 percent, France's CAC 40 was flat and Italy's MIB up 0.2 percent.

Holiday company Thomas Cook slumped 20 percent after saying its chief executive Harriet Green was stepping down two years after leading a turnaround of the group.

European stocks have been rising in the past few weeks, lifted by the prospect of further measures from the ECB including quantitative easing. But the rally stalled this week, with a number of indexes bouncing within a tight range.

"The trend seen in investment flows is still positive for equities, but the recent rally is losing steam and we're using the rebound to trim some of our long positions," Barclays France director Franklin Pichard said.

Europe bourses in 2014: link.reuters.com/pap87v

Asset performance in 2014: link.reuters.com/gap87v

Today's European research round-up

(Additional reporting by Francesco Canepa in London, editing by Mark Heinrich)


Reuters

Comments

Leave your comment
facebook twitter youtube google