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London - Commodity and oil producers prolonged a winning streak, pushing European stocks higher for a fourth day, the longest stretch of gains since August.
Anglo American [JSE:AGL], Rio Tinto and BHP Billiton [JSE:BIL] rose at least 4.4% after Morgan Stanley upgraded the shares. Royal Dutch Shell and Total SA added 3% or more, with a gauge of energy stocks poised for its biggest seven-day gain since 2008 as crude rose.
The Stoxx Europe 600 Index rose 1% to 364.17 at 10:34. The benchmark gauge has jumped 5.2% in four sessions as investors speculate the Federal Reserve won’t rush to raise rates and miners head for the longest rally since 2013 amid a rebound in Glencore [JSE:GLN].
“The potential for a steep rebound is pretty good,” said Teis Knuthsen, chief investment officer at Saxo Bank A/S’s private-banking unit in Hellerup, Denmark.
“As volatility starts to settle down, oil prices come up, and Glencore doesn’t default, I think we may be quite surprised by the speed in which markets can recover - especially those at extremely depressed levels, like commodities and energy.”
A gauge of euro-area stock volatility fell for a sixth day, down 4.4%, after climbing for the past two months, including August’s biggest jump since 2008.
The Stoxx 600 is rebounding after tumbling as much as 18% from an April record amid worries about global growth and the Fed’s thinking. Traders are now pricing in a 58% chance of a liftoff in March, the first month with at least even odds.
Some shares rose on deal activity. Anheuser-Busch InBev NV rose 3.1% after raising its bid for SABMiller [JSE:SAB], saying two previous bids were rejected. SABMiller added 1.8%, paring an advance of as much as 3.5%, after saying the revised offer still undervalued the company.
Norway stimulus
Norwegian energy companies Seadrill and Subsea 7 SA rallied at least 4.5% after the country said it will spend money from its sovereign wealth fund next year to stimulate the economy and cover budget gaps.
Volkswagen AG, the automaker that lost as much as $33bn in market value after admitting to cheating on emission tests last month, rose 5.6% for a third day of gains. The company may start recalling the rigged diesel cars in January and plans to complete repairs by the end of 2016, CEO Matthias Mueller told Frankfurter Allegemeine Zeitung.
Airline shares declined the most among Stoxx 600 groups, with EasyJet and Deutsche Lufthansa AG down 4.8% or more, as the increase in oil prices means drives up fuel costs.
