Basic resource, oil stock rally drives European share rise

  • Reuters
  • Stock Market News
Basic resource, oil stock rally drives European share rise
Credit: © Reuters.

* STOXX 600 up 0.2 pct

* Zodiac plummets on another profit warning

* Swedish fashion retailer H&M down on sales miss

* German utility E.ON drops after 16 bln euro loss (Updates prices)

By Helen Reid

LONDON, March 15 (Reuters) - European shares rose on Wednesday, boosted by basic resource and oil stocks, while French aeroplane seat-maker Zodiac fell more than 13 percent after its latest profit warning.

The pan-European STOXX 600 .STOXX index gained 0.2 percent in early trading, with the market focused on potentially divisive elections in the Netherlands and a U.S. Federal Reserve policy meeting that could signal how much monetary tightening to expect during the remainder of the year.

A recovery in oil prices after a surprise U.S. crude stockpile drawdown eased worries about a supply glut spurred a rally in basic resources stocks with the sector .SXPP up 2 percent, followed by major European oil-related stocks .SXEP which rose 1.3 percent. Tinto RIO.L and Glencore GLEN.L were among the top gainers, with their shares up 2.3 to 2.7 percent.

British drugmaker Hikma HIK.L was up 7.7 percent after it posted a 2.4 percent rise in full-year operating profit on growth in its injectables and branded business, which offset weakness in its generic drugs.

Finnish stainless steel producer Outokumpu OUT1V.HE was up 4.6 percent, set for its best day in six weeks, after the European benchmark price for ferrochrome, a crucial raw material for steel production, was set lower than expected. ZODC.PA was the biggest European faller, after it warned on profit after the close on Tuesday. The company, which engine maker Safran (PA: SAF ) is seeking to acquire, said it sees full-year operating income falling 10 percent against a previous forecast of a 10-20 percent rise. fashion retailer H&M HMb.ST was among the biggest fallers, with its shares down 4.8 percent after it posted its first monthly sales drop in four years. Europe-wide retail sector index .SXRP was the worst-performing, down 0.6 percent, with Zara owner Inditex ITX.MC also down 1.3 percent after it posted a 10 percent rise in profit for 2016.

German utility E.ON < EONGn.DE> fell 3.6 percent after it posted a record 16 billion euro ($17 billion) loss due to impairments on its former power plant unit Uniper UN01.DE which it spun off last year. (Editing by Vikram Subhedar and Alexander Smith)

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