Europe open: Stocks edge higher; oil prices under pressure again

European stocks edged up in early trade, recovering a touch from the previous session’s losses as investors continued to eye this week’s speech by Federal Reserve Chair Janet Yellen at Jackson Hole.

At 0840 BST, the benchmark Stoxx Europe 600 index was up 0.4%, while Germany’s DAX and France’s CAC 40 were 0.3% firmer.

At the same time, oil prices remained under pressure as hopes of a production freeze faded and amid reports that Iraq – OPEC’s second-biggest producer – was set to ramp up its exports. West Texas Intermediate was down 3% at $47.05 per barrel and Brent crude was 0.7% lower at $48.83.

Goldman Sachs stuck to its forecast that oil would remain at $45-$50 a barrel through next summer. “We reiterate our view that the oil price and fundamental recovery remains fragile,” the bank said.

Markus Huber, a trader at City of London Markets, said: “European shares are showing early signs of a rebound this morning after yesterday's disappointing start to the new trading week. Mixed markets overnight in Asia and the US are providing stocks with a bit of a lift this morning, with the main topic currently dominating stocks still the timing of a potential US interest rate hike as early as September.

“Whilst many still consider a hike in US interest rates in September and generally ahead of the Presidential election in November highly unlikely it appears that some FOMC members like already in previous years around the same time in August and September feel the need again to spread uncertainty but probably in the end will fail to deliver.”

In corporate news, housebuilder Persimmon rallied after reporting a better-than-expected jump in first half pre-tax profit of 29% to £352.3m.

UniCredit was also in the black following a report that the chief executive of Polish insurer PZU was heading to Milan for talks to buy Bank Pekao from the Italian bank.

BHP Billiton got a boost as Jefferies lifted its recommendation on the stock to ‘buy’ from ‘hold’.

Investors will eye the release of Eurozone PMI surveys at 0900 BST.