Energy Stocks, HSBC Lead Markets Higher
European shares closed broadly higher Monday, paring some of the losses from the previous session, as heavyweight energy stocks were supported by high oil prices and banks benefited from HSBC's first-quarter results.
Shares in HSBC, Europe's biggest bank, gained 1.9 percent after it posted a year-on-year rise in quarterly profit as growth in Asia and elsewhere helped counter a $3.2 billion bad-debt charge related to its U.S. consumer finance business.
Some analysts had expected a quarterly loss.
Energy stocks also helped market sentiment, with France's Total up 1.4 percent as the oil price remained in sight of Friday's record highs.
"The high oil price is helping the oil sector and the commodity sector is also doing well, but the more the oil price rises, the more it becomes a problem for the overall economy so it's not universally bullish," said Ronan Carr, equity analyst at Morgan Stanley.
The FTSEurofirst has recovered 12.6 percent since hitting a 2-1/2 year low in mid-March, although the index is still 10 percent lower than at the start of the year.
Standard Life gained 1.5 percent, helped by a note from Citi analysts upgrading the UK insurer to "buy," while an upgrade to "neutral" from Lehman lifted Marks & Spencer's to a six-week high.
Credit Suisse raised its price target on Germany's second largest listed steelmaker Salzgitter to 201 euros from 189, sending the stock 4.5 percent higher.
French luxury goods group Hermes surged 6 percent to record highs as traders cited market speculation of stakebuilding in the maker of silk scarves and Birkin handbags.
Officials at Hermes could not be immediately reached for comment.
British mid-cap Chloride Group jumped 35 percent.
The company, whose products protect against power shortages, said it had rejected a takeover approach, which it said materially undervalued it.
Dana Petroleum climbed 5.8 percent after the oil and gas explorer said it had discovered oil at the East Rinnes field in the UK Northern North Sea.
Volumes remained light due to partial holidays in some countries such as Germany and France.
Investors were also keeping a close eye on news of a major earthquake that shook China's Sichuan province, injuring more than 100 and killing five children.
"With another natural disaster in Asia, commodity prices could once again come to centre stage, as more relief may be needed, causing further increases in food prices," said Stephen Surpless, senior analyst at Cantor Fitzgerald.
In Shanghai, where trading was disrupted nearly half an hour before the stock market closed, the benchmark Shanghai Composite Index ended up 0.4 percent.