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Europe shares close higher on Iran nuclear deal

European equities closed higher on Monday after an historic deal over Iran's nuclear program bolstered risk appetite.


The pan-European FTSEurofirst 300 index provisionally closed up 0.4 percent to 1,302.53 points and oil prices fell sharply after Iran and six world powers sealed a preliminary deal to curb Iran's nuclear program at the weekend.

Germany's DAX continued its push higher, closing up 0.9 percent and reaching another fresh all-time high above 9,200 points.

The interim agreement, which sees Iran curtailing its development of nuclear activities in return for reduced international sanctions, has the potential to remove the "Middle East premium" from oil prices analysts said, but Israel and prominent U.S. Republicans have criticized the deal.

U.S. President Barack Obama said the deal was an important first step towards a comprehensive agreement and that sanctions relief would be switched off in six months if Iran does not meet commitments.

U.S. stocks drifted mostly higher on Monday, with the S&P 500 and Dow at record highs and the Nasdaq above 4,000 for the first time in 13 years, as Wall Street considered an unexpected drop in pending home sales in October.

The news boosted risk appetite in Asia, lifting regional equity markets, and did the same for sentiment in Europe as investors hoped this could be the start of improved relationships with the country.

Bourses may have seen a boost but the biggest laggard was actually oil and gas stocks with the prospect of more oil in the market weighing on their stock prices. BP shares closed down 0.64 percent, Shell closed down 0.36 percent and Total finished trade lower by 0.30 percent.

In contrast, airlines were buoyed by the prospect of cheaper fuel. IAG rose 2.64 percent, Air France-KLM closed up 1.83 percent and easyJet higher by 1.70 percent.

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In stocks news, Peugeot Citroen provisionally closed higher by 5.08 percent after reports of likely changes in senior management.

(Read More: Peugeot's CEO prepares to step aside for Dongfeng deal)

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