LONDON: European shares ended decidedly higher on Monday as an unexpected rise in German business morale underscored the resilience of the region’s largest economy, while wind turbine maker Siemens Gamesa jumped on a takeover offer.
After rising as much as 1.3% earlier in the day, the pan-European STOXX 600 index ended 1.3% higher. German shares rose 1.4%. Commodity-linked stocks gained about 2% on the back of higher oil and base metal prices, while banks rose 2.3%. Siemens Gamesa jumped 6.2% after Siemens Energy launched a 4.05 billion-euro ($4.3 billion) bid for minority holdings in struggling wind turbine unit.
Siemens Energy’s largest shareholder - Siemens AG - rose 1.4%. “The very fact there’s still deal making going on is helping lift sentiment ... because it shows that there is still appetite for opportunity,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Landsdown.
Markets have had a volatile few weeks, with the STOXX 600 posting another weekly loss on Friday as investors grappled with COVID-19 updates from China, signs of global recession from companies and economic indicators.
A survey from the Ifo institute showed that German business morale unexpectedly rose in May, offering hope that Europe’s largest economy was proving resilient in the face of high inflation, supply-chain problems and the war in Ukraine.