LONDON: European shares edged higher on Wednesday, extending the previous session's gains, with the telecoms sector getting a big lift from deal-making and takeover talk.
The pan-European FTSEurofirst 300 index was up 0.3 percent at 1,610.88 points at 1408 GMT, holding on to gains driven on Tuesday by speculation the European Central Bank's bond-buying plan could be rolled out more aggressively than expected.
French telecoms group Altice surged 11 percent after it agreed to buy Suddenlink in a $9.1 billion deal to enter the fast-growing U.S. cable sector. Altice's French rivals Orange and Bouygues fell about 1.5 percent.
"The whole of U.S. cable is a turnaround story. (Altice's) USP is doing turnarounds with leverage. Not without risk, but the value potential is very high," Gary Paulin, founding Partner of Aviate Global, said.
"As long as the team can execute, shareholders are going to see a lot of value creation over time."
Credit Suisse also said in a note that it believed there was room for Altice to run assets in new markets better and thereby create value through merger and acquisition.
Vodafone was up 4.6 percent after Liberty Global's chairman was quoted as saying it would be a "great fit".
Merger talk also lifted German retailer Metro up 1 percent, after a source told Reuters the owner of German department store chain Karstadt had made a new takeover offer for Metro-owned Kaufhof.
Financials were also in focus, with Switzerland's UBS up 3.4 percent after saying it had settled a probe by U.S. authorities over alleged rigging of currency markets by agreeing to pay $545 million in combined fines and pleading guilty to one count of wire fraud in a separate matter.
The Swiss bank's disclosure comes as part of what is expected to be a combined bill of more than $5 billion and criminal charges for five of the world's biggest banks in a settlement with U.S. and British authorities over the foreign exchange probe.
Luxury-goods group Burberry fell 5.6 percent after it lowered its 2016 retail and wholesale profit guidance due to foreign exchange movements and said it was seeing increased uncertainty in some markets, taking the shine off forecast-beating results.
Greek shares fell 0.7 percent after rising earlier after Moody's said the outlook for Greece's banking system was negative and a senior ruling party lawmaker said Greece would not be able to make a payment to the International Monetary Fund on June 5 unless foreign lenders disburse more aid.
Comments
Comments are closed for this article.