Europe open: Stocks gain ground as miners, banks advance

European stocks rose in early trade as positive sentiment from last week’s post-Trump rally carried over.

At 0845 GMT, the benchmark Stoxx Europe 600 index was up 1.2%, Germany’s DAX was 1.1% higher and France’s CAC was up 1.3%. The Stoxx 600 basic resources index was up 2.7% while the sub-index for banks was 1.8% firmer.

Meanwhile, oil prices were little changed amid ongoing worries about oversupply. West Texas Intermediate was up 0.1% to $43.44 a barrel and Brent crude was 0.4% firmer at $44.91.

Rebecca O’Keeffe, head of investment at Interactive Investor, said: “European markets are higher, with basic resources, healthcare and financial stocks on the march as the Trump transition continues. A week on from Trump's victory, markets are still trying to adjust to the new landscape, with significant geographic, asset class and sector moves.

“Emerging markets remain under fire, with money pouring out of areas such as Latin America as a currency correction combines with fears over trade deals. Industrial metal stocks continue their relentless march higher on expectations of huge infrastructure investment - but whether the recent gains truly match future demand is starting to be called into question. US 30 year treasury yields have hit 3% on expectations of fiscal easing combined with US inflationary expectations. These market changes have been aggressive and reactionary, but the key question for investors is how much further the market will move or whether this sector rotation has been overdone?”

On the corporate front, Societe Generale and UniCredit were in focus amid rumours of a possible merge between the two.

Siemens rose after agreeing to buy US-based Mentor Graphics in a $4.5bn all-cash deal.

German utility RWE powered ahead after it said 2016 earnings were expected to be at the upper end of its guidance range.

Housebuilder Taylor Wimpey advanced as it said in a trading update that the UK housing market remained resilient, despite the implications of Brexit still being unclear, and hailed strong trading in the second half.

Irish distribution and business support services company DCC surged after reporting a rise in half-year revenue and saying full-year operating profit is likely to be ahead of market expectations.

Legal & General was on the front foot after announcing the completion of a £1.10bn pension buyout deal with Rolls-Royce.

Standard Life gained ground despite saying that the possible combination involving its Indian joint venture, HDFC Life, and Max Life Insurance Company, Max Financial Services and Max India, had hit a roadblock.

Bookmaker William Hill pushed higher after saying it expects full-year adjusted operating profit to be the top end of its guidance, while Tesco rallied as HSBC upped its stance on the stock to ‘buy’ from ‘hold’.

Investors in Europe were also digesting some mixed data out of China. The country’s fixed-asset investment was up 8.3% in the January-to-October period, ahead of forecasts, but industrial output and retail sales growth in October fell short of analysts’ expectations.

Still to come, eurozone industrial production figures are at 1000 GMT.