- Title: European shares rise as bank stocks recoup post-Brexit losses
- Date: 24th October 2016
- Summary: FRANKFURT, GERMANY (OCTOBER 24, 2016) (REUTERS) RUBBISH TRUCK DRIVING PAST FRANKFURT STOCK EXCHANGE TRADING FLOOR TRADERS DAX CURVE VARIOUS OF TRADERS BOARD SHOWING OPENING AT 10,743.87 POINTS VARIOUS OF TRADERS VARIOUS OF BANK SHARES ON BOARD TRADERS INDICES ON BOARD (SOUNDBITE) (German) HEAD OF CAPITAL MARKETS ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING: "The Dax started positively, for which there are several reasons. One of them is the expectation that Mrs. Clinton will win the US election. That would mean that free trade will continue, which is not certain with Trump. So that is helping the German stock exchange at the moment. This week we will get the IFO (business climate) index, which will be at least stable and in earnings season there won't be much potential for disappointment there because expectations remain very low." VARIOUS OF TRADERS BOARD SHOWING LOW OF 10,743.37 POINTS (SOUNDBITE) (German) HEAD OF CAPITAL MARKETS ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING: "Three companies are interesting to me this week: firstly, Deutsche Bank. There we want to hear about the big issue, the fine in the United States - it would be great if we finally good some concrete figures, and that would help Deutsche Bank shares too. Then VW, Volkswagen. I hope that the settlement on the emissions scandal goes through in San Francisco and is confirmed. We also want to see how the cost-reduction programme is going at VW. Finally, Bayer: how is the takeover of Monsanto looking? These three companies are important." TRADER BOARD SHOWING HIGH OF 10,780.96 POINTS (SOUNDBITE) (German) HEAD OF CAPITAL MARKETS ANALYSIS AT BAADER BANK, ROBERT HALVER, SAYING: "The British prime minister of course wants Scotland to stay in the United Kingdom. That is very important, but Mrs. May also wants to strengthen the relationship with Ireland - her goal is to not completely cut the link to the euro zone, to Europe. But it must be made clear: the UK will probably have to go through a messy divorce, because they want to become an industry hub for big companies and so taxes are being cut as brutally as possible." VARIOUS OF TRADERS BOARD SHOWING GAIN OF 66.77 POINTS, OR 0.62 PER CENT TRADER DAX CURVE TRADERS TRADING FLOOR
- Embargoed: 8th November 2016 08:37
- Keywords: stocks DAX
- Location: FRANKFURT, GERMANY
- City: FRANKFURT, GERMANY
- Country: Germany
- Topics: Economic Events
- Reuters ID: LVA00155D5RPP
- Aspect Ratio: 16:9
- Story Text: European shares rose on Monday (October 24), with Germany's Dax hitting a year-high. It climbed 0.9 percent to 10,808.93 points just under an hour into trading, the highest it has been since December 30, 2015.
The head of capital markets analysis at Baader Bank said one reason for the high was increasing confidence that Hillary Clinton would beat Donald Trump in the US election on November 8.
"That would mean that free trade will continue, which is not certain with Trump. So that is helping the German stock exchange at the moment," Robert Halver told Reuters.
European bank stocks were among the big winners on Monday, rising to recoup all of the losses they suffered in the wake of Britain's shock "Brexit" vote in June to quit the European Union.
The STOXX Europe 600 Banks index was up 1.3 percent at 152.16 points by 0725 GMT.
Although the European banks index remains down around 17 percent since the start of 2016, the index rose on Monday above the 150 points level for the first time since June 23 - the day before global stock markets slumped after the Brexit result.
European bank stocks have recovered in recent weeks, helped by robust results by leading U.S. banks and by signs of rising bond yields, which would typically help banks' profits.
Nevertheless, the worst of the post-Brexit storm likely still lies ahead.
"The UK will probably have to go through a messy divorce, because they want to become an industry hub for big companies and so taxes are being cut as brutally as possible," Halver said.
Conditions are set to get much tougher next year when Britain is due to formally start the process to leave the EU no later than March, which will kick off two years of exit negotiations.
Eyes at Frankfurt stock exchange were also on Volkswagen on Monday, where a decision is expected soon from a San Francisco judge on a settlement related to the company's use of illegal software to defeat U.S. emissions testing.
U.S. District Judge Charles Breyer said last week he was "strongly inclined" to approve a record-setting $10.033 billion proposed buyback and compensation offer from Volkswagen for 475,000 owners of polluting 2.0-liter diesel vehicles.
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