LONDON (Reuters) - European shares rose on Monday, with gains across bourses and industry sectors, as the focus gradually shifts from the earnings season to monetary policy and politics with Italy’s election on Sunday.
Shares gave up some of their gains after comments by European Central Bank President Mario Draghi suggested the bank was still confident that inflation was on an upward trend, supporting market expectations for the bank to finally end its bond purchase programme this year.
New U.S. Federal Reserve Chairman Jerome Powell is to give his first House testimony on Tuesday.
The pan-European STOXX benchmark index closed up 0.6 percent at 383.34 points. A number of shares which investors have often bet against enjoyed strong gains without any corporate announcement to justify the rise.
One trader mentioned satellite firms SES, up 9.7 percent, German drugs packaging firm Gerresheimer’s up 2.4 percent or French pipe maker Vallourec up 4.6 percent.
“Investors are becoming more content to buy back into the market, and the memory of the sharp sell-off at the start of the month is continuing to fade,” said CMC Markets analyst David Madden.
Italy’s benchmark index was one of the worst country performers, up 0.2 percent. Italian debt costs rose last week ahead of a national election expected to result in a hung parliament.
Nordic telecom companies Nokia and Ericsson were up 2.3 percent and 1.3 percent respectively.
Expectations for next-generation 5G networks are on the rise after Nokia’s CEO said major telecom operators were accelerating their timelines for adopting 5G by up to a year.
Deutsche Bank closed almost flat after gaining earlier in the session following an announcement that it would float its asset management arm DWS on the Frankfurt stock exchange, as it fights to regain investor trust afters years of scandals and restructuring.
Lloyd’s of London underwriter Hiscox posted the worst performance of the index with a 4.7 percent fall after it reported a drop of more than 90 percent in full-year pretax profit, as it faced the costliest year ever for insurers and reinsurers due to natural disasters.
Bank of Ireland fell 2.1 percent. The lender said it would resume dividend payments for the first time since the financial crisis and reported underlying profits steady at 1.1 billion euros.
Outside the STOXX 600, shares in Dutch postal company PostNL sank 17 percent after it lowered its cash operating income target for 2020.
Editing by Andrew Heavens