European shares rebound on prospect of Greek creditor accord

LONDON: European shares rebounded from a one-week low on Wednesday, supported by the prospect of an accord between Greece and its creditors.

The FTSEurofirst 300 index of top European shares was up 1.3 percent to 1,623.38 points at the provisional close, after falling to a one-week low on Tuesday.

The rebound accelerated on reports of staff-level agreement between Greece and its creditors, traders said.

But European Commission Vice President Valdis Dombrovskis said Greece and its international creditors were not yet at the point of drafting an agreement.

"It clearly shows that the markets have got a reaction on all these occasions as they'd like to see a deal, a continuation of the euro zone as a whole," said IG analyst Chris Beauchamp.

"But you shouldn't really believe anything until the deal is officially on the table and the ink is dry. Until you reach that point, everything is just up in the air as it has been."

Greek shares closed 3.6 percent up.

The market was also supported by a survey showing morale among German consumers improved heading into June, helped by a growing willingness to make purchases.

"The German consumer confidence survey came in higher than expected, which should bode well for domestic consumption in the months ahead," Markus Huber, senior analyst at Peregrine & Black, said. "There is very little major data scheduled to be released today, keeping the focus ever more on Greece."

Among other sharp movers, Italy's biggest insurer, Generali , climbed 2.8 percent. The company said it would pay cumulative dividends of more than 5 billion euros ($5.5 billion) to the end of 2018, as it focuses on increasing cash generation and building a solid capital base.

Nokia rose 3.6 percent after the Finnish telecoms network equipment maker announced plans to buy U.S. company Eden Rock Communications.

Shares in Novozymes, the world's largest maker of industrial enzymes, gained 3.9 percent after UBS raised its stance on the stock to "buy" from "sell".

Energy shares were also in demand, with the STOXX Europe 600 Oil and gas index rising 0.7 percent.