EUROPEAN shares rose for a fourth consecutive session in thin volume yesterday as strong Chinese data and results from SABMiller encouraged some investors to bet on a continuation of the recent bounce.
SABMiller was the top riser, adding 6.9 per cent in volume after it reported strong growth, and heavyweight basic resources stocks were also well bid, up 0.7 per cent, after a Chinese private manufacturing index hit a 13-month high.
“Any time you get positive data out of China and potential for sustained demand, the natural thing is to pick up some mining stocks,” Oliver Stansfied, director of equity sales at Fox Davies.
He also flagged interest in UK oil major BG Group, up 1.2 per cent to 1,230 pence, as the shares successfully rebounded from a two-year low of 990p but still looked cheap compared to a 1,350p price before the group issued a profit warning earlier this month.
They helped the pan-European FTSEurofirst 300 index index close 0.6 per cent higher 1,103.43 points – up 3.4 per cent since last Friday, the best weekly performance since February.
Weekly technical charts on the broader STOXX 600 index showed buying momentum was piling up after the index’s Relative Strength Index bounced off a line connecting lows hit last June and in September 2011.
“If we close at current levels tomorrow that will probably lead to a test of the multiple tops that you have seen during Q3 and Q4 (at 276 points),” Anders Soderberg, a technical analyst at SEB in Stockholm.