A surge in banks, miners and automakers galvanised European stocks on Friday, as continued rotation into the cyclical sectors amid signs of progress in US-China trade talks drove the Stoxx 600 to its fourth straight week of gains.[BENGALURU] A surge in banks, miners and automakers galvanised European stocks on Friday, as continued rotation into the cyclical sectors amid signs of progress in US-China trade talks drove the Stoxx 600 to its fourth straight week of gains.
The euro zone banks index, up 7 per cent on the week, tacked on its biggest weekly gain since March 2017."The new tiering system for the banks ought to help the North European banks that have built up large excess deposits while the cheaper loans should help the funding costs of the Southern banks," Jefferies analysts wrote in a client note.According to Jefferies' calculation, the old system was costing euro area banks 7.
In a change of heart among investors who had been buying defensive stocks for much of this year on worries about global trade disputes tipping the world into a recession, momentum stocks such as automakers and miners saw a huge demand this week. Both the pan-European Stoxx 600 index and the euro zone only index closed about 0.3 per cent higher on the day, while tacking on more than 1 per cent for the week.
Shares of Atlantia tumbled 8 per cent after three employees of companies owned by the Italian infrastructure group were placed under house, as part of an investigation into the safety of motorway viaducts following the collapse of a bridge in Genoa.
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