European shares rose for a sixth straight session on Wednesday to trade around their highest in nearly four months, led by financials, as a slew of encouraging corporate results indicated the recession was easing.
Investors ignored reports that Bank of America may need as much as $34 bln in fresh capital, and looked at BNP Paribas, which posted first-quarter profits well ahead of forecasts, helped by higher earnings at its retail and investment banking operations. BNP shares rose 6.6%.
By 1021 GMT, the FTSEurofirst 300 index of top European shares was up 0.5% at 851.19 points after rising up to 854.94 — the highest since mid-January. The index has gained 2.5% this year after plunging 45% in 2008.
Financial stocks were among top gainers, with Standard Chartered rising 6.2%, HSBC up 3.6%, Royal Bank of Scotland gaining 1.9% and Natixis increasing 4%.
The DJ STOXX European banks index, which has more than doubled since hitting a trough on March 9, was up 1.7% on Wednesday. The index slumped 65% in 2008.
There is "a general feeling of well being … across the markets, with the joyous cries of the bulls beginning to drown out the doom mongers," said Chris Hossain, senior sales manager at ODL Securities.
"As we approach half way through the week, it will be interesting to note how the banking stress test and the non-farm payroll figures will impact on sentiment in the latter part of the trading week."
Ten of the 19 U.S. banks being stress-tested are expected to need more capital buffers, a person familiar with the official talks has said.
Many analysts have speculated that other banking companies that may need more capital, either because they do not have enough tangible common equity or are experiencing rising loan losses, include Citigroup Inc and Wells Fargo.
Around Europe, Britain's FTSE 100 rose 0.2%, the German DAX gained 0.1% and the French CAC 40 added 0.7%.
AUTOMAKERS GAIN
Automobile stocks were in demand after BMW, the world's largest premium automaker, posted smaller-than-expected quarterly losses and Ford Motor said it has invested $550 mln to build small cars and other electric vehicles.
BMW rose 5.4%, while Daimler AG, Porsche, Volkswagen AG, Peugeot, Renault, Fiat were up 0.4 to 2.1%.
Miners were broadly higher. BHP Billiton, Anglo American, Xstrata and Eurasian Natural Resources rose between 0.4% and 3.3%.
"The focus is very much on individual stocks and people are looking closely at the quarterly earnings reports," said Michael Koehler, equity strategist at German bank LBBW.
Dutch supermarket group Ahold rose 6% after it reported first quarter sales of 8.65 bln euros ($11.6 bln) at the top end of forecasts as a broad restructuring helped it weather a weaker spending environment.
Total, France's biggest listed company, reported a smaller-than-expected drop in first-quarter net profit on Wednesday after crude prices halved and oil and gas production fell. But its shares were down 1.5%. (Reuters)
