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Sept. 12, 2017, 12:03 p.m. EDT

European stocks rise for 5th day, with banks up as bond yields rise

Stoxx 600 posts longest winning run since April

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By Carla Mozee and Sara Sjolin, MarketWatch


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Deutsche Bank and other bank shares are rising Tuesday.

European stocks advanced Tuesday, with gains for financial shares reflecting rise in benchmark yields in government bonds in line with an improvement for perceived riskier assets such as equities among investors.

The Stoxx Europe 600 index /zigman2/quotes/210599654/delayed XX:SXXP +0.41%  picked up 0.5% to close at 381.42, scoring a fifth straight day of wins. That marks the longest winning streak for the pan-European benchmark since April, according to FactSet data.

The benchmark on Monday surged 1%, the largest rise in four weeks, as concerns about Hurricane Irma and North Korea’s weapons program receded.

“Market sentiment continues to improve again as the key risk events that drove the safe haven flow at the end of last week continues to unwind, which has helped the dollar and equities higher,” said Richard Perry, market analyst at Hantec Markets.

“With the destruction of Hurricane Irma not as bad as feared and Kim Jong Un opting simply for a [Foundation Day] party that did not go off with a bang, there has been a significant retracement of some of the huge declines on Treasury yields,” said Perry.

Investors world-wide had sought refuge from risks in bonds. But as that is reversing, prices are declining and yields are moving higher, which bodes well for interest-rate sensitive banks. The Stoxx Europe 600 Bank Index /zigman2/quotes/210599339/delayed XX:SX7P +0.79%  ended up 1.7% on Tuesday, its biggest one-day percentage gain since early July. Meanwhile, the yield for benchmark 10-year German bonds /zigman2/quotes/211347112/realtime BX:TMBMKDE-10Y 0.00% , for example, were up 0.400%, compared with 0.349% late Friday in New York. Bond prices and yields move inversely.

Shares of Deutsche Bank /zigman2/quotes/205584254/delayed DE:DBK +0.84%   /zigman2/quotes/203042512/composite DB -0.09%  popped up 3.6%, Commerzbank AG /zigman2/quotes/200193353/delayed DE:CBK +1.44%  picked up 2.9% and Banco Santander SA /zigman2/quotes/205677933/delayed ES:SAN +1.54%  moved up 0.9%.

As Irma’s wrath wasn’t as destructive as anticipated, the Stoxx Europe 600 Insurance Index /zigman2/quotes/210599350/delayed XX:SXIP -0.48% rose 0.8%. AXA SA /zigman2/quotes/202169431/delayed FR:CS -0.28%  climbed 1.2% and Swiss Re AG /zigman2/quotes/203711779/delayed CH:SREN -0.43%  tacked on 1%.

Stock movers: Ashtead Group PLC /zigman2/quotes/200232063/delayed UK:AHT -0.38%  jumped 4.5%, to become the strongest performer on the FTSE 100. The equipment rental company posted a 29% rise in pretax profit and said Hurricanes Harvey and Irma may bolster demand.

Whitbread PLC /zigman2/quotes/207954631/delayed UK:WTB -0.97%  fell 0.4% after Citigroup downgraded its rating to sell from buy, saying it’s “cautious on European hotels.” Whitbread runs the Premier Inn hotel chain.

Indexes: Germany’s DAX 30 index /zigman2/quotes/210597999/delayed DX:DAX +0.37% rose 0.4% to end at 12,524.77 and France’s CAC 30 index /zigman2/quotes/210597958/delayed FR:PX1 +0.56% rose 0.6% to 5,209.01.

But the FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX +0.07%  flipped lower, losing 0.2% at 7,400.69. The move came as the pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.3294%  jumped following U.K. inflation data that was stronger than expected. Inflation rose to 2.9% in August year-over-year, more than a FactSet estimate of 2.8%. Sterling bought $1.3276, up from $1.3160 late Monday in New York.

The euro /zigman2/quotes/210561242/realtime/sampled EURUSD +0.4113%  traded at $1.1963, little changed from $1.1953 late Monday in New York.

Read: Why the Swiss central bank may be betting on a stronger euro

In other developments Tuesday, Swedish inflation rose to 2.3% in August. Analysts polled by FactSet had expected a 2.2% reading.

/zigman2/quotes/210599654/delayed
XX : STOXX
393.23
+1.60 +0.41%
Volume: 0.00
Nov. 27, 2020 11:03p
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/zigman2/quotes/210599339/delayed
XX : STOXX
111.42
+0.87 +0.79%
Volume: 0.00
Nov. 27, 2020 11:03p
loading...
/zigman2/quotes/211347112/realtime
add Add to watchlist BX:TMBMKDE-10Y
BX : Tullett Prebon
-0.58
0.00 0.00%
Volume: 0.00
Nov. 27, 2020 6:01p
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/zigman2/quotes/205584254/delayed
DE : Germany: Frankfurt
9.48
+0.08 +0.84%
Volume: 31,605
Nov. 27, 2020 8:58p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€417,912
loading...
/zigman2/quotes/203042512/composite
US : U.S.: NYSE
$ 11.36
-0.01 -0.09%
Volume: 1.21M
Nov. 27, 2020 5:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$23.35 billion
Rev. per Employee
$484,143
loading...
/zigman2/quotes/200193353/delayed
DE : Germany: Frankfurt
5.37
+0.08 +1.44%
Volume: 69,862
Nov. 27, 2020 8:59p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
€166,016
loading...
/zigman2/quotes/205677933/delayed
ES : Spain: Madrid
2.47
+0.04 +1.54%
Volume: 68.38M
Nov. 27, 2020 5:38p
P/E Ratio
N/A
Dividend Yield
3.15%
Market Cap
€42.07 billion
Rev. per Employee
€405,338
loading...
/zigman2/quotes/210599350/delayed
XX : STOXX
275.39
-1.32 -0.48%
Volume: 0.00
Nov. 27, 2020 11:03p
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/zigman2/quotes/202169431/delayed
FR : France: Euronext Paris
19.73
-0.06 -0.28%
Volume: 6.84M
Nov. 27, 2020 5:37p
P/E Ratio
17.19
Dividend Yield
3.70%
Market Cap
€47.17 billion
Rev. per Employee
€1.13M
loading...
/zigman2/quotes/203711779/delayed
CH : Switzerland: SWX
CHF 83.74
-0.36 -0.43%
Volume: 1.57M
Nov. 27, 2020 5:30p
P/E Ratio
N/A
Dividend Yield
7.05%
Market Cap
CHF23.61 billion
Rev. per Employee
CHF3.16M
loading...
/zigman2/quotes/200232063/delayed
UK : U.K.: London
3,150.00 p
-12.00 -0.38%
Volume: 1.63M
Nov. 27, 2020 4:35p
P/E Ratio
21.89
Dividend Yield
1.29%
Market Cap
£14.23 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/207954631/delayed
UK : U.K.: London
3,162.00 p
-31.00 -0.97%
Volume: 980,475
Nov. 27, 2020 4:35p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
£6.41 billion
Rev. per Employee
£57,931
loading...
/zigman2/quotes/210597999/delayed
DAX
DX : Xetra Indices
13,335.68
+49.11 +0.37%
Volume: 63,823
Nov. 27, 2020 6:30p
loading...
/zigman2/quotes/210597958/delayed
FR : France: Euronext Paris
5,598.18
+31.39 +0.56%
Volume: 84,634
Nov. 27, 2020 6:05p
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/zigman2/quotes/210598409/delayed
UK : FTSE UK
6,367.58
+4.65 +0.07%
Volume: 1.42M
Nov. 27, 2020 4:59p
loading...
/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.3314
-0.0044 -0.3294%
Volume: 0.0000
Nov. 27, 2020 4:59p
loading...
/zigman2/quotes/210561242/realtime/sampled
US : Tullett Prebon
1.1963
+0.0049 +0.4113%
Volume: 0.0000
Nov. 27, 2020 4:59p
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Carla Mozée is a reporter for MarketWatch, based in London. Follow her on Twitter @MWMozee. Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.

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