European stocks logged broad gains on Monday, lifted by Italian banks after Rome stepped in to shut down two failed lenders, and as Nestlé rallied after a hedge fund snapped up a major stake in the consumer-products giant, MarketWatch reports.
The Stoxx Europe 600 index climbed 0.6% to 389.87, setting it on track for its highest close in a week.
Stocks across Europe were last week pressured by a renewed selloff in oil prices, with crude slumping to a 10-month low on Wednesday. However, oil prices jumped more than 1% on Monday, helping lift energy giants on the European markets.
Shares of Total added 0.6%, Royal Dutch Shell rose 0.9%, and Repsol put on 0.6%.
Italian bank rescue: The Italian government on Sunday reached a deal to close two struggling lenders — Veneto Banca and Banca Popolare di Vicenza — after the European Central Bank on Friday evening declared that the pair was set to fail. The bill to assume responsibility for liquidating the banks’ bad loans and other items could cost the government as much as €17bn.
The “good” assets of the banks will be transferred to Intesa Sanpaolo for the token price of €1 . Shares of Intesa rose 3.1% on Monday after the news. Among other Italian banks, shares of Unione di Banche Italiane added 3.5% and UniCredit picked up 2.7%.
Italy’s FTSE MIB index rallied 1.1% to 21,062.29.
Other movers: Shares of Nestlé jumped 4.3%, on track for an all-time closing high. The rally came after news that billionaire activist investor Daniel Loeb’s Third Point hedge fund has taken a $3.5bn stake in the Swiss consumer-products stalwart.
Individual indexes: Germany’s DAX 30 index climbed 0.6% to 12,806.14, while France’s CAC 40 index gained 0.8% to 5,309.48.
The UK’s FTSE 100 index traded 0.6% higher at 7,467.28, boosted by the benchmark’s oil companies.
The euro was down at $1.1188, compared with $1.1193 late Friday in New York.
This article was published by MarketWatch