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European stocks surge in risk-on trade, financials lead; Dax up 2.95%

Published 06/20/2016, 03:36 AM
© Reuters.  European stocks open sharply higher as Brexit fears ease
UK100
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FCHI
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DE40
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HSBA
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BARC
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LLOY
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NWG
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ALVG
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RIO
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TW
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Investing.com - European stocks surged on Monday, as concerns over a potential British exit from the European Union, or Brexit, eased and as rising oil prices lent support to the energy sector.

During European morning trade, the EURO STOXX 50 soared 3.14%, France’s CAC 40 -rallied 2.76%, while Germany’s DAX 30 surged 2.95%.

Brexit concerns subsided after two opinion polls published on Saturday showed that support for the 'Remain' campaign had regained its lead over a vote to leave, while a third showed momentum shifting in favor of a vote to remain in the 28 member bloc.

Campaigning for the June 23 referendum resumed on Sunday after a three-day break prompted by the killing of pro-EU British lawmaker, Jo Cox.

The boost in risk appetite pushed financial stocks sharply higher, as French lenders BNP Paribas (PA:BNPP) and Societe Generale (PA:SOGN) soared 4.22% and 3.71%, while Germany’s Commerzbank (DE:CBKG) and Deutsche Bank (DE:DBKGn) climbed 4.50% and 5.28%.

Among peripheral lenders, Italy’s Intesa Sanpaolo (MI:ISP) and Unicredit (MI:CRDI) advanced 4.51% and 6.05% respectively, while Spanish banks BBVA (MC:BBVA) and Banco Santander (MC:SAN) gained 3.76% and 4.99%.

Energy-related stocks added to gains, helped by a rally in oil prices.

French oil and gas major Total SA (PA:TOTF) rallied 2.39% and Italy’s ENI (MI:ENI) jumped 1.96%, while Russian rival Gazprom (MCX:GAZP) surged 2.43%.

Elsewhere, Allianz (DE:ALVG) shares climbed 3.24% after the German insurer said it acquired Zurich Assurances Maroc, a subsidiary of Zurich Insurance Company in Morocco.

In London, FTSE 100 jumped 2.32%, as U.K. lenders tracked their European counterparts sharply higher.

HSBC Holdings (LON:HSBA) jumped 1.72% and Barclays (LON:BARC) rallied 5.49%, while Lloyds Banking (LON:LLOY) advanced 5.84% and the Royal Bank of Scotland (LON:RBS) soared 8.33%.

Mining stocks were also mostly higher on the commodity-heavy index, as Rio Tinto (LON:RIO) rallied 1.65% and BHP Billiton (LON:BLT) climbed 2.26%, while Glencore (LON:GLEN) surged 2.72%. Randgold Resources (LON:RRS) underperformed however, with shares plunging 2.12%.

Taylor Wimpey (LON:TW) was also one of the top performers on the index, with shares up 5.40% after analysts at Deutsche Bank reiterated their ‘buy’ rating on the stock.

In the U.S., equity markets pointed to a sharply higher open. The Dow Jones Industrial Average futures pointed to a 1.11% jump, S&P 500 futures a 1.21% rally, while the Nasdaq 100 futures indicated a 1.20% gain.

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