European equities climbed to a three-month high on Tuesday, with a rally in commodities-related stocks and encouraging updates from companies such as French cosmetics firm L'Oreal and advertising group Publicis.
L’Oreal rose 5.5 per cent as it pledged to outperform the market in 2016 and confirmed its ambition to achieve another year of sales and profit growth after first-quarter sales rose more than expected.
At 0820 GMT, the pan-European FTSEurofirst 300 index was up 1.3 per cent at 1,372.70 points after touching 1,374.88, its highest level since early January. The European basic resources index rose 2.5 per cent to its highest since November, with sentiment improving after Rio Tinto reported an 11 per cent rise in first quarter iron ore shipments. There was also a slew of supportive economic signals from China, the world’s top metals consumer.
“The most recent PMI data from China has reversed the negative trend. The possibility that China is stabilising is reassuring markets after a torrid first couple of months at the beginning of the year,” Lorne Baring, managing director at B Capital Wealth Management in Geneva, said.
China's leaders now sound more confident that the world's second-largest economy has arrested a slide in growth to quarter-century lows. Shares in Anglo American, Glencore and Rio Tinto rose 1.0 to 1.5 per cent. The oil and gas index also advanced, up 1.3 per cent, after oil prices rose as a strike in Kuwait cut huge amounts of crude out of the supply chain.
Swedish investment firm Kinnevik rose 5.9 per cent after the company proposed SEK 5 billion ($616.52 million)extraordinary cash distribution to shareholders. Advertising group Publicis gained 5 per cent after reporting higher first-quarter revenue, helped by accounts won at the end of last year and growth at digital business Sapient.
Reuters
