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European shares post weekly gain on strong miners, banks slump
February 10, 2017 / 8:40 AM / 10 months ago

European shares post weekly gain on strong miners, banks slump

MILAN (Reuters) - European shares edged higher on Friday, ending the week in positive territory thanks to corporate earnings and robust basic resources stocks, though declines among Italian banks led that sector to its worst week since November.

Traders work at their desks in front of the German share price index, DAX board, at the stock exchange in Frankfurt, Germany, February 8, 2017. REUTERS/Staff/Remote

The pan-European STOXX 600 index was up 0.1 percent and set for a weekly gain of 0.9 percent that brought it close to a 13-month peak hit in January.

The week saw volatility because of investor unease over how parliamentary elections in France this spring might pan out and the re-emergence of concerns that Greece might leave the euro.

“Sentiment today is supported by good economic data from China, Italy and the UK ... but the week has seen ups and downs as investors seek reassurance that Europe will hold together,” said Carlo Alberto De Casa, Chief Analyst at ActivTrades.

French entertainment company Ubisoft was the top STOXX gainer, up 10.9 percent after it revised its profitability target upwards.

Stronger than expected trade figures from leading metals consumer China buoyed copper prices to their highest level since June 2015, in turn lifting mining stocks.

The STOXX 600 Basic Resources index .SXPP posted its best daily gains since Nov. 9, the day of Donald Trump’s election as U.S. President. The index closed up 3.7 percent, the biggest sectoral gainer in Europe.

It was also lifted by shares in ArcelorMittal, the world’s largest steelmaker, which rose 9.3 percent after posting a higher-than-expected quarterly core profit.

Swedish mining and smelting firm Boliden contributed to mining gains, up 9.7 percent after well-received earnings including a higher than expected dividend. The shares touched their highest level since early 2000.

Banks across Europe showed weakness, with the banking index down 0.8 percent as Italian banking results weighed.

Banca Popolare dell‘Emilia Romagna, was the top European faller, down 7.8 percent reporting a plunge in net income late on Thursday.

UBI Banca fell 5.7 percent after it posted a 2016 net loss of 830.2 billion euros. The banks caused Italy’s FTSE MIB to underperform its peers, closing down 0.5 percent.

Banks also weighed on Spain’s IBEX which was down 0.6 percent.

British online takeaway company Just Eat tumbled 6.7 percent after CEO David Buttress unexpectedly stepped down.

Reporting by Danilo Masoni, Helen Reid; Editing by Kevin Liffey and John Stonestreet

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