European Markets Bounced Back After Banks Rebound

(RTTNews) - The European markets ended Wednesday's session firmly in positive territory, snapping a 3-session losing streak. Bank stocks halted their recent sell-off and recovered some lost ground. Energy stocks also turned in a solid performance on investor hopes for an agreement to curb production at today's informal OPEC meeting in Algiers.

Low interest rates are necessary today for a return to higher rates in the future and other policy areas must contribute much more decisively to reap the full benefits of monetary policy, European Central Bank President Mario Draghi said Wednesday.

Speaking in the German parliament Bundestag, Draghi said, "The ECB is vigorously counteracting risks to price stability using all necessary tools within its mandate."

More monetary policy easing will be required at some point in the U.K. to avoid the economic slowdown to become more pernicious in the wake of EU referendum, Bank of England Deputy Governor Minouche Shafik said Wednesday.

In a speech, text of which was put on the BoE website, Shafik said the likely timing of stimulus will depend on the continued evolution of the data over the coming weeks and months.

So far, data suggests that the slowdown may not be as sharp or as sudden as feared earlier.

The U.K. economy is currently experiencing a period of uncertainty and adjustment following the Britons' surprise vote in June to leave the European Union, but the longer term prospects are positive, Bank of England Governor Mark Carney said in an interview published Wednesday.

"As all of the MPC said in our most recent decision in September, the broad contours of how the economy is performing [are] in line with what we had expected in August," Carney said in the interview to the Herald Scotland newspaper.

"We had expected in August that the economy would slow materially during the second half of this year, relative to relatively strong growth in the first half of this year. Broad brush, that is what we are seeing."

The pan-European Stoxx Europe 600 index advanced 0.68 percent. The Euro Stoxx 50 index of eurozone bluechip stocks increased 0.68 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, added 0.56 percent.

The DAX of Germany climbed 0.74 percent and the CAC 40 of France rose 0.77 percent. The FTSE 100 of the U.K. gained 0.61 percent and the SMI of Switzerland finished higher by 0.55 percent.

In Frankfurt, Deutsche Bank climbed 2.23 percent after it announced it has reached an agreement with Phoenix Life Holdings Limited, a subsidiary of Phoenix Group Holdings Limited, to sell its Abbey Life business for 935 million pounds.

Rival Commerzbank also increased 1.29 percent.

In Paris, Credit Agricole advanced 1.86 percent and Societe Generale added 1.13 percent. BNP Paribas also finished higher by 0.95 percent.

Total rose 0.49 percent and Technip climbed 0.40 percent.

In London, Royal Bank of Scotland Group gained 0.92 percent after it agreed to pay $1.1 billion to settle National Credit Union Administration claims it mis-sold faulty mortgage-backed securities in the run-up to the financial crisis.

TUI rose 1.29 percent after the tour operator updated investors on recent trading and lifted its 2015/16 core profit guidance.

UK Mail Group surged 43.41 percent. Germany's Deutsche Post DHL has agreed to buy the British letter and parcel delivery service for 440 pence per share in cash, valuing the entire issued ordinary share capital of the latter at about 242.7 million pounds.

Engineering conglomerate Smiths Group advanced 4.04 percent after its fiscal 2016 pre-tax profit increased to 346 million pounds from 325 million pounds last year.

Grocer J Sainsbury fell 3.91 percent after reporting a 1.1 percent decline in second-quarter sales.

SABMiller increased 0.56 percent after its shareholders approved its merger with Anheuser-Busch InBev. Anheuser-Busch InBev also gained 1.24 percent in Brussels.

Tullow Oil jumped 1.06 percent and BP climbed 0.95 percent. Royal Dutch Shell also added 0.28 percent.

German consumer confidence is set to drop in October due to rising terror threat and the decision taken by the British public to leave the European Union, survey data from GfK showed Wednesday.

The forward-looking consumer sentiment index fell to 10.0 in October from 10.2 in September. The score was forecast to remain unchanged at 10.2.

French consumer sentiment remained unchanged in September, survey data from the statistical office Insee showed Wednesday. The consumer confidence index held steady at 97. The score remained below its long-term average of 100.

Italy's consumer confidence dropped for a second straight month to its lowest level in 14 months during September, while factory morale rebounded, survey data from ISTAT showed Wednesday. The consumer confidence index declined to 108.7 from 109.1 in August, revised from 109.2. Economists were looking for a score of 109.

With an increase in orders for transportation equipment offset by decreases in orders for other manufactured goods, the Commerce Department released a report on Wednesday showing that new orders for U.S. manufactured durable goods came in flat in August.

The Commerce Department said durable goods orders were virtually unchanged in August after jumping by a revised 3.6 percent in July. Economists had expected orders to pull back by about 1.4 percent compared to the 4.4 percent spike that had been reported for the previous month.