European Stocks Rally as Energy Prices Cool

The pan-European STOXX 600 index rose 1.1% in broad-based buying to reverse weekly losses, with miners, automakers and utilities in the lead.

Oil prices dropped for a second session, while European gas futures also fell back from record highs. [O/R]

There was also some relief on the U.S. debt ceiling front after U.S. Senate Republican Leader Mitch McConnell announced plans to extend the borrowing limit into December.

French luxury goods maker Hermes jumped 3.1% after HSBC upgraded the stock to “hold”, while peers LVMH, Richemont and Kering all rose more than 2%.

Royal Dutch Shell inched up 0.4% after saying that soaring natural gas and electricity prices around the world will provide a significant boost to its cashflow in the third quarter.

Swiss construction chemicals maker Sika rose 2.0% after it said it could overcome rising raw material costs and supply chain restrictions to increase its sales and profit margins this year.

For a look at all of today’s economic events, check out our economic calendar.

(Reporting by Sruthi Shankar in Bengaluru; Editing by Subhranshu Sahu)