Europe close: Stocks end mostly higher

21st May 2024 01:04

(Sharecast News) - European shares extended gains on Monday even as investors eyed events in Iran after the death of President Ebrahim Raisi in a helicopter crash over the weekend, along with the country's foreign minister.

The pan-European Stoxx 600 index was up 0.18% at 523.89 with most major markets higher.

Milan's FTSE Mib was the exception, falling 1.62% to 34,825.01.

Boosting sentiment, Bank of England Deputy Governor Ben Broadbent said it was "possible" that interest rates would be cut this summer.

Scope Markets analyst Joshua Mahony said attention would now turn to the UK inflation read-out on Wednesday, "with a collapse in headline CPI looking likely to grab the attention of the markets given the potential impact that could have on rate cut expectations".

On commodities markets, gold prices surged to $2,450 per ounce, before falling back to $2,430 per punce.

"Demand for the safe-haven asset has surged as investors have been digesting news of the death of Raisi (and) foreign minister Hossein Amir-Abdollahian in a helicopter crash," said Hargreaves Lansdown analyst Susannah Streeter.

"Demand has also likely to have been pushed up by renewed speculation that the Federal Reserve will be minded to cut interest rates a couple of times this year."

In equity news, Swiss luxury goods group Richemont rose 5%, extending gains on the back of record sales reported on Friday.

Shares in EPC Group slumped 2% after the French explosives manufacturer said it faces an investigation by the country's competition authority.

Porsche stock fell 2% as Morgan Stanley cut its sector view for German carmakers from "in-line" to "cautious", citing falling margins and potential trade disputes.

Volkswagen slipped 1.0% after being downgraded to 'under-weight' from 'equal-weight' due to exposure to China which would pressure margins.