Sun, Jan 18, 2015 - Page 15 News List

Energy stocks rally EU markets to best levels since 2008


European stocks rose to their highest level since 2008 this week, as gains by oil producers outweighed a slump in Swiss shares.

The STOXX Europe 600 Index climbed 1.1 percent to 352.4 at the close on Friday, after earlier losing as much as 0.9 percent. A surprise move by the Swiss National Bank (SNB) to end a cap on the franc sent the gauge fluctuating in Thursday’s session. It closed 2.6 percent up amid speculation that the move strengthens the case for quantitative easing by the European Central Bank next week.

The STOXX 600 gained 4.3 percent for the week, posting its biggest weekly advance since December 2011. It is 0.4 percent below the high it hit on Dec. 5 last year, as a drop in commodity prices dragged energy and mining stocks lower. The number of shares changing hands on STOXX 600-listed companies was 23 percent greater than the average of the past 30 days, data compiled by Bloomberg showed.

Nestle SA, Novartis AG and Roche Holding AG — the largest shares on the STOXX 600 — dropped more than 4.5 percent. Watchmakers Cie. Financiere Richemont SA and Swatch Group AG slid more than 6.5 percent, extending losses from a day earlier.

A gauge of energy shares posted the best performance among 19 industry groups in the STOXX 600 as oil prices rose. Total SA and BG Group PLC added more than 3 percent, while BP PLC climbed 5.3 percent after a US judge ruled it had dumped less oil into the Gulf of Mexico in 2010 than the US government had calculated, decreasing the maximum fine the company faces.

“It’s very difficult to pinpoint a direction in the markets,” said Teis Knuthsen, chief investment officer at Saxo Bank A/S’ private banking unit in Hellerup, Denmark. “You have to fear how much the Swiss central bank’s decision will hurt the Swiss economy.”

The Swiss Market Index declined 6 percent this week, after posting its biggest slide since 1989 on Thursday as the franc surged over the SNB’s announcement — it was the gauge’s worst week since 2008.

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