By Sara Sjolin, MarketWatch
LONDON (MarketWatch) -- European stock markets rose for a second
straight day on Monday as fears about the soundness of Portuguese
banks continued to recede, and investors instead focused on
upcoming data and corporate results.
The Stoxx Europe 600 index picked up 0.7% to 339.06, after
posting its biggest weekly percentage loss since March on
Friday.
The weakness last week came as Portuguese conglomerate Espírito
Santo International SA missed a debt payment, sending shivers
through Portugal's financial sector and spurring fears about the
rest of the Espirito Santo empire.
After an initial wobble, shares of Banco Espírito Santo SA slid
7.1% on Monday after the bank appointed Vítor Bento, a
well-respected economist, as its new chief executive in an effort
to restore confidence in the company.
"It's hardly surprising that, just five years on from the worst
global banking crisis in recent memory, the market has the scope to
overreact to banking-contagion fears," said David White, trader at
Spreadex, in a note.
Portugal's PSI 20 index rose 0.7% to 6,182.84, and Portuguese
government bonds also continued to rise, sending the yield on
10-year government paper down 5 basis points to 3.80%.
Elsewhere, France's CAC 40 index gained 0.5% to 4,338.11 and
Germany's DAX 30 index put on 0.7% to 9,733.28. The U.K.'s FTSE 100
index added 0.6% to 6,731.46, buoyed by a 2.7% gain for Shire PLC
after a revised offer from AbbVie Inc. (ABBV).
Shares of Tesco PLC (TSCDY) climbed 2.1% in London after Cantor
Fitzgerald lifted the grocery chain to buy from sell, according to
Dow Jones Newswires.
Shares of Airbus Group NV picked up 1.3% in Paris after the
plane maker unveiled a major upgrade of its A330 long-range
jet.
In Brussels, RTL Group SA slipped 0.9% after Credit Suisse
downgraded the broadcaster to neutral from outperform.
In data news, Eurostat said euro-zone industrial production
slumped 1.1% in May from April, marking the largest month-to-month
drop since September 2012 and highlighting that the currency area's
economic recovery remains weak. The report followed lackluster
national figures last week, with France, Italy and Germany all
posting disappointing indicators.
Later in the week, German's ZEW report, euro-zone trade data and
inflation numbers will provide further insights into the strength
of the region's recovery. U.K. labor market figures are also out on
Wednesday.
After the markets close on Monday, European Central Bank
President Mario Draghi speaks to the European Parliament in
Strasbourg. The ECB boss is expected to confirm that the governing
council stands ready to act with a full-blown quantitative-easing
program if needed and focus on keeping a lid on further euro gains,
according to Simon Smith, chief economist at FxPro.
The euro (EURUSD) traded at $1.3624, up from $1.3609 late on
Friday.
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