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European stocks open higher with eyes on ECB meeting; DAX up 1.06%

Published 12/07/2016, 03:30 AM
© Reuters.  European stocks climb ahead of ECB decision, digest Italy referendum

Investing.com - European stocks opened higher on Wednesday, as investors eyed the European Central Bank’s upcoming policy meeting, amid growing hopes for additional stimulus measures, and as markets continued to digest the Italian referendum results.

During European morning trade, the EURO STOXX 50 climbed 0.82%, France’s CAC 40 advanced 0.90%, while Germany’s DAX 30 jumped 1.06%.

Markets were still recovering after Italian voters rejected on Sunday constitutional changes backed by the government and the subsequent resignation of Prime Minister Matteo Renzi.

However there were indications that Italy would not hold early elections after Renzi’s resignation, with many analysts thinking it more likely that a caretaker government will be put in place until an election in 2018.

Financial stocks were sharply higher, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) surged 2.38% and 2.29%, while Germany’s Deutsche Bank (DE:DBKGn) and Commerzbank (DE:CBKG) rallied 1.20% and 3.95%.

Among peripheral lenders, Italy’s Intesa Sanpaolo (MI:ISP) and Unicredit (MI:CRDI) jumped 2.61% and 1.67% respectively, while Spanish banks Banco Santander (MC:SAN) and BBVA (MC:BBVA) climbed 2.04% and 1.52%.

Siemens AG (DE:SIEGn) added to gains, as shares advanced 1.58% after the company unveiled on Tuesday its first specialized transportation vessel designed to transport nacelles used in Siemens’ direct-drive 8 MW wind turbines.

On the downside, E.ON SE (DE:EONGn) saw shares tumble 1.41% after the German energy supplier said it was not expecting payments soon, after the country's constitutional court ruled that nuclear operators were to be compensated for government decisions in 2011 that work towards speeding withdrawal from nuclear power.

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In London, commodity-heavy FTSE 100 gained 0.94%, boosted by sharp gains in the mining sector.

Shares in Glencore (LON:GLEN) jumped 2.52% and Antofagasta (LON:ANTO) surged 3.64%, while rival company Rio Tinto (LON:RIO) soared 4.38%.

Financial stocks were also on the upside, as Lloyds Banking (LON:LLOY) climbed 0.81% and the Royal Bank of Scotland (LON:RBS) jumped 1.51%, while HSBC Holdings (LON:HSBA) and Barclays (LON:BARC) rallied 2.39% and 2.77% respectively.

Meanwhile, WPP (LON:WPP) was one of the worst performers on the index, with shares down 1.92% after the advertising company said it will be spending about $70 million with Snapchat on behalf of clients.

In the U.S., equity markets pointed to a steady to higher open. The Dow Jones Industrial Average futures pointed to a 0.10% gain, S&P 500 futures showed a 0.02% uptick, while the Nasdaq 100 futures indicated a 0.07% rise.

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