Europe open: Stocks in the black as oil rebounds

European stocks rose in early trade as oil prices rebounded and investors digested some encouraging data releases from China and Germany.

At 0900 BST, the benchmark Stoxx 600 index was up 0.5%, Germany’s DAX was 0.2% higher and France’s CAC 40 was up 0.5%.

At the same time, oil prices pushed higher, with West Texas Intermediate up 2.5% to $36.78 a barrel and Brent crude 1.6% firmer at $38.46.

“European equity markets are trading slightly higher, with the energy sector leading the way on the back of stronger commodity prices,” said Rebecca O’Keeffe, head of investment at stockbroker Interactive Investor.

“Oil prices jumped after OPEC officials suggested that a deal to limit output could be achieved at the organisation's upcoming meeting in Qatar. However, market sentiment remains relatively fragile as concerns grow that the potential upside may be less compelling that the downside risk.”

Sentiment was also supported by news that China’s service sector strengthened in March. The Caixin services purchasing managers’ index rose to 52.2 from 51.2 in February, beating expectations for a reading of 51.4.

German data was also better than expected, with figures from Destatis showing industrial production fell 0.5% in February following a revised 2.3% growth the month before, which was much better than the 1.8% drop economists had pencilled in.

On the year, production rose 1.3%, which was down from a revised 1.8% in January but better than the 0.4% forecast.

Pantheon Macroeconomics said: “A surprisingly strong headline, even factoring in the large downward revision of last month’s jump.”

On the corporate front, Glencore was higher after it confirmed that it has agreed to sell 40% of its agriculture commodities business to the Canada Pension Plan Investment Board for $2.5bn (£1.8bn) in cash.

Shares in H&M rose despite the Swedish retailer posting a 30% decline in first quarter net profit.

It was a bad day for airlines, however. Easyjet flew lower after the budget carrier reported a rise in passenger numbers in March but a drop in the load factor.

Air France-KLM slumped after it announced the departure of its chief executive Alexandre de Juniac.

Looking ahead, investors will eye the release of the latest minutes from the Federal Open Market Committee meeting at 1900 BST.