Europe open: Shares rally as investors shrug off Evergrande worries
European shares rallied at the opening on Tuesday after a sharp fall in the previous session as investor fears about the China Evergrande debt crisis.
The pan-European Stoxx 600 index was up 0.74% in early deals after falling 1.67% on Monday. All major regional bourses were higher with Germany’s DAX rebounding to rise 0.91%.
Hong Kong shares fell slightly overnight as China Evergrande chairman Hui Ka Yuan tried to reassure investors that the debt-saddled company would "walk out of its darkest moment".
The real-estate developer has debts of more than $300bn and is in a race to raise the cash so it can pay lenders and suppliers with market observers already invoking the spectre of the collapse of US bank Lehman Brothers, which sparked the financial crash of 2008.
Investors are also eyeing central bank policy meetings this week, including the US Federal Reserve and Bank of England for any indication of a slowdown in fiscal stimulus.
In equity news, British Airways, Aer Lingus and Iberia owner IAG continued to make gains on news the US was looking at opening up to double-vaccinated European travellers in November. Lufthansa shares were also higher.
Shares in UK passenger transport operator National Express jumped 3.4% after rival Stagecoach said it was in talks about a possible all-share merger. Stagecoach shares surged 16%.
Universal Music Group, which has Lady Gaga, Taylor Swift and The Weeknd in its stable, soared 38.1% in its first day of trading. The company was valued at around €33.5bn ahead of its debut. Shares in parent Vivendi slumped 20%.
UMG has spent hundreds of millions of dollars investing in talent, including the $300m acquisition of Bob Dylan’s publishing catalogue.
Anglo-French DIY group Kingfisher fell 4.54% as it reported a surge in interim profits but said third quarter sales were down 0.6% and noted a slowdown in the second quarter. However, it also raised second-half sales forecasts.