Europe Markets

Energy Shares Boost Europe, Banks Slip


European stocks rose on Thursday, driven by a rally in energy shares as the price of crude oil broke back above $130 a barrel, while gains in the broader markets were tempered by fresh worries about the banking sector.

German utility E.ON was the largest individual positive influence on the broader market, rising 2.8 percent , while oil majors BP and Total followed closely behind, rising 1.2-1.5 percent.

The FTSEurofirst 300 index of top European shares rose 0.3 percent to an unofficial close of 1,330.64 points, having oscillated during the day between a loss of 0.2 percent and a gain of 0.8 percent.

"There's nothing in the winners and losers page that makes me feel the market is feeling particularly happy about life, so the things that are going up are the defensive stocks," said Andrew Lynch, a portfolio manager at Schroders.

"It's the big companies that are going up and that is pulling the market up, but the broader tenor is still cautious." Banks were once again the biggest drag on the index, led largely by Royal Bank of Scotland.

Shares in RBS fell by as much as 6.1 percent at one point to an eight-year low on concern in the market that its planned rights issue may encounter problems.

RBS declined to comment.