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European shares rise on German election relief

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(stock image)

(stock image)

(stock image)

German shares hit ten-day highs on Monday after the federal election outcome reduced the chances of a left-wing coalition gaining power, while broader European markets cheered a surge in crude prices that powered oil stocks.

Germany's blue-chip DAX jumped 1pc, leading gains among regional indexes, while the pan-European STOXX 600 index added 0.6pc in early deals.

Germany's centre-left Social Democrats were set to start trying to form a government after they narrowly won their first national election since 2005, saying they would seek to form a coalition with the Greens and the liberal Free Democrats in what is dubbed as the "traffic light" coalition.

While it might take a while before the new government is formed, investors were relieved that hard-left Linke party fell below the 5pc threshold needed to enter parliament.

Oil & gas stocks jumped 1.2pc as Brent futures headed for $80 per barrel amid supply concerns as parts of the world sees demand pick up with the easing of pandemic conditions.

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