EUROPE MARKETS: European Stocks Finish In The Green As Deutsche Bank And Oil Shares Rally
September 28 2016 - 12:51PM
Dow Jones News
By Sara Sjolin and Victor Reklaitis, MarketWatch
Embattled German bank to sell insurance unit amid bailout
buzz
European stocks closed with firm gains on Wednesday, as a rally
for embattled Deutsche Bank AG sparked a banking-sector recovery,
while oil companies rose amid of a closely watched OPEC meeting in
Algeria.
The Stoxx Europe 600 index jumped 0.7% to end at 342.57,
trimming its monthly loss to 0.3%.
"European equity markets are positive, following oil prices
higher, as investors eye Algiers in the hope that today's OPEC
meeting will reach some compromise," said Rebecca O'Keeffe, head of
investment at Interactive Investor, in a note.
"Although an agreement to curb output today would be a major
surprise, the debate may pave the way for a potential deal at their
next meeting," she added.
Oil prices were choppy on Wednesday, but traded in the green by
day's end in Europe. West Texas Intermediate crude was up 1.2% at
$45.22 a barrel, while Brent added 1.6% to $47.23 a barrel. Market
players are shifting their focus to November
(http://www.marketwatch.com/story/crude-higher-but-market-faces-long-wait-for-next-opec-move-on-output-2016-09-28)
as the time when the Organization of the Petroleum Exporting
Countries could decide on a more definitive plan to curtail output
that has suppressed prices for two years.
The gains helped fuel optimism over Europe's commodity
companies, with shares of Total SA (TOT) (TOT) up 0.5%, and BP PLC
(BP.LN) (BP.LN) and Repsol SA (REPYY) both 1% higher.
Deutsche Bank boost: Shares in Deutsche Bank (DBK.XE) (DBK.XE)
rose as much as 4% in Wednesday trade, before paring gains to
finish up 2%.
The move came after a report in Die Zeit that the German
government is working on a rescue plan for the bank
(http://www.marketwatch.com/story/german-government-preparing-rescue-plan-for-deutsche-bank-report-2016-09-28).
Germany's finance ministry, however, dismissed the story as
"false," according to reports.
Deutsche Bank Chief Executive John Cryan late Tuesday denied
reports that he had asked the government for assistance, telling
German newspaper Bild that a state rescue is "out of the
question."
The bank -- Germany's biggest -- earlier this week dropped to an
all-time closing low on reports the government was ruling out any
potential state aid for it.
Read:Deutsche Bank's woes not a Lehman moment, says UBS chairman
Axel Weber
(http://www.marketwatch.com/story/deutsche-banks-woes-not-a-lehman-moment-says-ubs-chairman-axel-weber-2016-09-28)
A deal to sell its Abbey Life insurance business to Phoenix
Group
(http://www.marketwatch.com/story/deutsche-bank-sells-abbey-life-for-12-billion-2016-09-28)
for EUR1.09 billion ($1.23 billion), also helped lift the bank's
stock on Wednesday.
"It seems that investors are choosing to focus on CEO John
Cryan's reassuring comments ... rather than the unsubstantiated
rumors currently flying around," said Connor Campbell, financial
analyst at Spreadex, in a note.
Deutsche's rebound on Wednesday fueled gains for the entire
sector, with shares of Banco Santander SA (SAN)(SAN) up 1.3%, BNP
Paribas SA (BNP.FR) rising 1% and Commerzbank AG (CBK.XE) 1.3%
higher.
Other movers: Shares in Royal Bank of Scotland Group PLC
(RBS.LN) (RBS.LN) rose 1% after the bank agreed to pay $1.1 billion
(http://www.marketwatch.com/story/rbs-pays-11-billion-to-settle-lawsuits-in-us-2016-09-28-34851318)
to a U.S. regulator to settle two lawsuits related to
mortgage-backed securities. The charge was within the amount RBS
set aside in provisions.
Also in London, Tui AG shares gained 1.2% after the travel
operator said it was confident of delivering between 12% and 13%
growth in underlying earnings
(http://www.marketwatch.com/story/tui-says-on-track-for-12-13-fy-earnings-growth-2016-09-28)
for the year that ends Sept. 30.
Deutsche Post AG (DPW.XE) added 0.3% after the courier company
said it is buying UK Mail Group for GBP242.7 million
(http://www.marketwatch.com/story/deutsche-post-strikes-deal-to-buy-uk-mail-2016-09-28)
($315.5 million).
Shares in Anheuser-Busch InBev NV (ABI.BT) (ABI.BT) rose 1.2% as
the brewing giant's shareholders approved all resolutions related
to its $100 billion-plus megamerger with rival SABMiller (SAB.JO) .
SABMiller shareholders also approved the deal
(http://www.marketwatch.com/story/sabmiller-shareholders-approve-ab-inbev-merger-2016-09-28-6485648),
helping send shares 0.6% higher.
Indexes: The U.K.'s FTSE 100 index rose 0.6% to end at 6,849.38
(http://www.marketwatch.com/story/ftse-100-breaks-3-day-losing-streak-as-oil-majors-rebound-2016-09-28),
with the oil majors helping the benchmark higher.
Germany's DAX 30 index advanced 0.7% to 10,438.34, while
France's CAC 40 index gained 0.8% to 4,432.45.
Economic news: European Central Bank President Mario Draghi
reiterated the need for structural reforms to boost economic
growth.
The central bank boss -- in a welcome address at an ECB
conference in Frankfurt -- also said the euro area needs "more
robust policy prescriptions" to promote growth.
(END) Dow Jones Newswires
September 28, 2016 12:36 ET (16:36 GMT)
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