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European shares close higher; oils gain

Published 09/20/2010, 11:37 AM
Updated 09/20/2010, 11:40 AM

LONDON, Sept 20 (Reuters) - European equities rose on Monday, on optimism that the economy will not slip back into recession, and with oil heavyweights gaining following a jump in crude prices.

The FTSEurofirst 300 index of top European shares rose 1.3 percent to end the day provisionally at 1,087.02 points, after falling on Friday when figures showed U.S. consumer sentiment dropped to its lowest level in more than a year.

Energy companies Total, ENI, BP and Royal Dutch Shell rose between 2 and 2.9 percent, as crude prices rose 2 percent to more than $75 a barrel, helped by expectations that inventories may have fallen. "Markets have continued to focus on cyclical support. We know that monetary policy is going to be extremely accommodative," said Bill Dinning, head of strategy at Aegon Asset Management in Edinburgh.

"It's when the market focuses on some of the hangovers like European sovereign debt we have problems. For now I think the cyclical is trumping the structural." (Reporting by Brian Gorman)

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