Markets rise as Deutsche Bank denies bailout talk
Newsflow on embattled German lender Deutsche Bank was a key driver of European markets by mid-afternoon yesterday.
The German government denied claims it was working on a rescue plan for the stricken bank, whose shares have collapsed this year as it struggles with tougher capital standards, negative interest rates and soaring legal bills.
The US government has also hit it with a $14bn fine for mis-selling mortgage securities in America.
Beyond the banking sector worries, markets were looking ahead to separate appearances by US Federal Reserve Chair Janet Yellen and European Central Bank President Mario Draghi, as well as a meeting of oil producers in Algiers.
But after a torrid couple of days, there was some good news for holders of shares in Deutsche Bank.
Germany's biggest lender said it sold its British insurance business, Abbey Life, to Phoenix Group for just under £1bn.
And Deutsche chief executive John Cryan told German newspaper 'Bild' that he had not sought state aid after a report the lender had asked for help to deal with the $14bn demand from the US Department of Justice. Deutsche shares were up about 2.7pc by lunchtime, having hit a record low on Tuesday.
"As banking worries are slowly getting behind us, the risk-on sentiment will be back," said Patrick Spencer, London-based vice chairman of equities at Robert W Baird, which manages $151bn in funds.
In Ireland, the ISEQ Overall Index followed in the footsteps of its European peers, rising 1.1pc by mid-afternoon.
Shares in Bank of Ireland, which have been see-sawing in recent sessions along with other financial stocks, rose 1.7pc to 17.6 cent.
Insulation maker Kingspan was 3.8pc higher at €24.28, while CRH was also trading well, moving up 2.1pc to €29.98.
Shares in agri group Origin Enterprises were 3.4pc higher at €5.70 by lunchtime. It said that its full-year, pre-tax profits fell over 25pc to €65.5m, as revenue rose 4.3pc to €1.52bn.
By mid-afternoon, the UK's FTSE-100 was trading almost 1pc higher. Germany's DAX was ahead 1.1pc, and France's CAC-40 was up 1pc.
Asian shares spent much of the trading session in negative territory, on investor concern about the state of the European banking sector and lower oil prices.
MSCI's broadest index of Asia-Pacific shares outside Japan moved in and out of negative territory and last stood less than 0.1pc higher on the day.
Japanese shares fell, with the Nikkei 225 index falling 1.3pc by the close.