Europe shares log record close, boosted by financials

The pan-European STOXX 600 index ended up 0.7% at 584.23 points

European shares logged a second consecutive record close on Wednesday, boosted by financials as investors weighed a series of corporate updates and focussed on a potential end to a historic U.S. government shutdown.

The pan-European STOXX 600 index ended up 0.7% at 584.23 points.

France’s CAC 40 added 1%, while Spain’s IBEX rose 1.4%.

Talking about U.S. shutdown relief hopes, Nick Saunders, CEO of stock trading platform Webull UK said, “that’s the underlying reason for the positive sentiment but beyond that, a lot of the rise (in European markets) has actually been earnings driven. We’ve seen some good reports this morning. It’s these good earnings figures that are driving the markets up.”

In particular, we see banks doing well in Europe. The bank-heavy indices, the CAC and the IBEX, are really pushing ahead and taking the whole of the European markets with them, he added.

Banks were the biggest boost to the STOXX index with ABN Amro gaining 2.6% after the Dutch lender announced upbeat quarterly earnings and that it had acquired domestic commercial lender NIBC Bank to strengthen its position in its home market.

European financial stocks have outperformed the broader market on annual price returns, helped primarily by better-than-expected earnings. Banks-heavy bourses in Spain and Italy have starkly outperformed the region’s STOXX benchmark this year.

European healthcare stocks rose 1.1%, while energy stocks dropped 0.6%.

On Wednesday, Britain’s SSE topped the STOXX index with a 16.8% gain after unveiling a £33 billion five-year investment plan as it seeks to upgrade the UK’s regulated electricity networks and bolster its renewables business.