Oil and financials boost European shares
European shares rose yesterday, looking to recover after two straight months of losses, with corporate earnings reports spurring brisk trading ahead of a what is typically a sleepy summer period for markets.
The pan-European STOXX 600 index, nursing two straight months of losses, rose 0.6pc. Blue chips closed 0.9pc higher, their best one-day gains in three weeks.
Germany's DAX advanced 1.1pc while Britain's commodities-heavy FTSE 100 gained 0.7pc as oil stocks rose.
The ISEQ Overall Index was up 0.64pc, or 42.25 points, to end the trading day at 6,691.64.
Earnings updates dominated the action, with oil heavyweight BP rising 2.8pc and boosting the oil & gas sector after beating forecasts as new projects supported production.
"BP has covered the cash component of the dividend with free cash flow for the second straight quarter and the Upstream business is performing well," analysts at Jefferies said in a note.
"Valuation is not challenging, but the company's ability to de-lever the balance sheet remains a concern."
The European second-quarter earnings season is nearing the halfway mark and so far 60pc of MSCI Europe firms have met or beaten analysts' expectations. Earnings per share growth in Europe was tracking at about 13pc, including a significant boost from energy firms, according to the latest data from JPMorgan.
"You have seen some signs of (the) green shoots of recovery within the European economy and that, of course, is good for companies," Laith Khalaf, senior analyst at Hargreaves Lansdown, said.
Morgan Stanley analysts said the euro's surge this year could weigh on European corporate profits, however.