STOXX 600 hits two-week high, but UniCredit, Commerzbank cap gains

By Joao Manuel Vicente Mauricio and Ankika Biswas

(Reuters) -Europe's main stock index hit a two-week high on Monday, driven by the nomination of the U.S. Treasury secretary and comments from the ECB chief economist on monetary policy easing, although lenders UniCredit and Commerzbank (ETR:CBKG ) fell on buyout developments.

The pan-European STOXX 600 was up 0.3%, as of 0935 GMT, led by luxury stocks and miners.

Italian bank UniCredit dropped 3.5% after launching a surprise all-share offer worth 10 billion euros ($10.45 billion) for smaller domestic rival Banco BPM, which climbed 2.6%.

Shares of Commerzbank fell 5.6%, weighing on the banking index, as investors assessed the impact of Unicredit (BIT:CRDI )'s Banco BPM deal on the German lender's likely buyout offer.

UniCredit CEO Andrea Orcel said any Commerzbank bid would come after the Banco BPM deal.

In a boost for global sentiment, Wall Street futures rose alongside a decline in U.S. Treasury yields, following Trump's selection of fund manager Scott Bessent as Treasury secretary. Bessent is expected to manage U.S. debt while also focusing on enacting trade tariffs.

"We have a flurry of nominations coming through and everyone's trying to determine what it means for the long term ... there isn't any real sense of how exactly the playing field is going to look in six or 12 months," Capital.com's senior market analyst Daniela Hathorn said.

"There are other things going on, specifically with central banks and how rates are going to evolve."

European Central Bank's chief economist Phillip Lane said the bank's policy should not remain restrictive for too long, while also acknowledging inflation will take some more time to fall back to 2%.

Tomra Systems jumped 7.7%, with analysts citing Spain's plans to introduce a deposit return scheme within two years, boosting the prospects for the Norwegian sustainable technology company's machine sales in key markets.

Vestas rose 4% after Deutsche Bank (ETR:DBKGn ) upgraded the Danish wind turbine maker's stock to "buy" from "hold".

ITV (LON:ITV ) climbed 6.6% following media reports that the British broadcaster could be a takeover target for a team led by CVC Capital Partners (WA:CPAP ).

Anglo American (JO:AGLJ ) rose 1.4% on plans to sell its Australian steelmaking coal mines for up to $3.78 billion to Peabody Energy.



On the flip side, home improvement retailer Kingfisher (LON:KGF ) slumped 13% after lowering the top-end of its annual profit outlook, dragging the retail sector.

German business morale fell more than expected in November, adding to the negative outlook for a country poised to be the worst G7 performer this year.

Source: Investing.com