European shares gain ground
European shares rose on Tuesday as investors pared back some of their expectations that the US Federal Reserve could hike interest rates in September.
|||London - European shares rose on Tuesday as investors pared back some of their earlier expectations that the US Federal Reserve could hike interest rates in September.
The pan-European STOXX 600 was up 0.4 percent, having fallen in the previous session on worries that a US rate hike could come as soon as September following a speech from Fed Chair Janet Yellen last week and hawkish comments from Vice-Chair Stanley Fischer.
The implied probability that the US Fed will hike interest rates in September had fallen back to 36 percent.
“Over the last couple of days ... those chances (of a US rate hike) have been reduced back to where we were before, before Yellen's comments on Friday,” said Dafydd Davies, partner at Charles Hanover Investments.
“The market has taken some sort of comfort from that.”
Investors are now eyeing Friday's US non-farm payrolls data for any clues as to the timing of a rate hike.
Germany's Wirecard was the top gainer, jumping 4 percent after Barclays raised its rating on the stock to “overweight” from “equal weight” and lifted its target price.
“Wirecard is not without controversy, but over the last decade it has built a strong strategic position both from a product and regional perspective and is well positioned in terms of our acquiring framework, in our view,” analysts at Barclays said in a note.
Britain's Bunzl also rose, up 2.1 percent after the business supplies distributor's first-half profit beat consensus.
The company also said that it did not expect Britain's vote to leave the European Union to have a significant impact.
Belgian investment holding company Ackermans & Van Haaren was the top faller, dropping 7.2 percent and set for its biggest daily loss in more than 5 months after reporting a weak set of first-half results.
Basic Resources sector was the biggest sectoral faller, down 2.5 percent as a fall in the price of copper weighed on mining stocks.
REUTERS