Investing.com - European stocks traded higher on Monday as markets shrugged off the no vote on the Italian referendum and the euro recovered from early losses.
During European morning trade, the Euro Stoxx 50 gained 1.54%, France’s CAC 40 traded up 1.52%, while Germany’s DAX 30 rose 1.79%.
Italian voters shot down Prime Minister Matteo Renzi’s constitutional reforms on Sunday in a move that initially sent the euro down to a 20-month low against the dollar.
The no vote along with Renzi’s confirmation that he was to resign after the defeat was widely expected, which might explain the recovery in the single currency. EUR/USD was last down just 0.23% at 1.0639, after having fallen more than 1% to an intraday low of 1.0507.
Also of note in European politics, far-right Freedom party candidate Norbert Hofer was beaten in Austria’s presidential election by former Green party, now independent nominee Alexander Van der Bellen.
French Prime Minister Manuel Valls was to announce later on Monday that he will run for president in next year’s elections, according to Agence France Presse.
On the economic calendar, the rate of euro zone economic expansion accelerated to its highest this year, though the composite purchasing managers’ index for November came in slightly below forecasts.
Euro zone finance ministers are scheduled to meet later in the session in order to discuss Greece’s bailout.
Meanwhile, oil prices rose despite concern over increased production stateside. Baker Hughes’ data on Friday showed that the number of rigs drilling for oil in the U.S. the prior week rose by three in what was the 13th increase in 14 weeks.
The ramp up in output comes just after last week’s accord between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC member Russia to cut production in 2017 in an attempt to support crude prices and reign in the global supply glut.
Energy stocks traded slightly higher, as French oil and gas major Total SA (PA:TOTF) gained 0.25% and Italy’s ENI (MI:ENI) edged forward 0.15%, while Norwegian rival Statoil (OL:STL) advanced 0.13%.
Financial stocks traded mostly higher, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) traded up 1.16% and 0.97%, while Germany’s Deutsche Bank (DE:DBKGn) rose 1.38%. German Commerzbank (DE:CBKG) was a notable exception with shares down 0.47%
Among peripheral lenders, Italian banks were under pressure from the referendum results with concern over how the shakeup in government would affect efforts to buffer capital. Intesa Sanpaolo (MI:ISP) managed to inch up 0.09% but Unicredit (MI:CRDI) was down 2.50%.
Meanwhile Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) advanced 1.66% and 1.47%.
In London, the commodity-heavy FTSE 100 gained 0.83% as activity in the British services sector hit a 10-month high, beating consensus.
Shares in Glencore (LON:GLEN) gained 1.25% and Anglo American (LON:AAL) rose 1.36%, while BHP Billiton (LON:BLT) and Rio Tinto (LON:RIO) traded up 2.30% and 1.77% respectively.
Energy stocks traded mixed, as BP (LON:BP) slipped 0.03% while rival Royal Dutch Shell (LON:RDSa) gained 0.47%.
Financial stocks added to gains, with shares in HSBC Holdings (LON:HSBA) up 0.33% and the Royal Bank of Scotland (LON:RBS) 1.99% higher, while Barclays (LON:BARC) and Lloyds Banking (LON:LLOY) advanced 2.75% and 1.27% respectively.
In the U.S., equity markets pointed to a higher open. The Dow Jones Industrial Average futures gained 0.46%, S&P 500 futures advanced 0.47%, while the Nasdaq 100 futures rose 0.62%.