Europe Stocks Rise for 2nd Day as Credit Suisse Leads Bank Gains 

• Carmakers climb as China auto sales increased in April
• Pandora jumps on better-than-forecast profit, raised outlook

European shares rebounded further as investors speculated a selloff that spurred their worst week since February was overdone, and Credit Suisse Group AG buoyed banks.

Credit Suisse rallied 5.8 percent after posting a smaller-than-estimated loss. ING Groep NV gained 5 percent after its net income beat the average analyst prediction. Carmakers climbed the most after lenders, buoyed by an increase in China’s monthly passenger-vehicle sales. Volkswagen AG and PSA Peugeot Citroen rose more than 3 percent.

The Stoxx Europe 600 Index added 1.2 percent at 10:05 a.m. in London, as five out of six shares rose. Optimism the Federal Reserve will slow its pace of rate increases amid weak U.S. data bolstered shares yesterday, while the euro weakened against the dollar for a fifth straight day after last week reaching its highest level since August.

“People are slightly less risk averse now than they were end of April,” said Michael Hewson, a London-based market analyst at CMC Markets Plc. “Stabilizing oil prices and a slightly weaker euro are helping the rally. Credit Suisse earnings weren’t great, but they were better than the worst of expectations. Still, the optimism is a little premature. Economic data hasn’t been very convincing.”

The Stoxx 600 is rising this week after falling 5.4 percent from an April 20 peak. A rally that pushed up the gauge 16 percent from a February low unraveled as analysts slashed estimates to call for a profit decline this year, and disappointing economic reports cast a pall on prospects for global growth.

Still, that has led to expectations that monetary policy will remain supportive for longer. They are pricing in little chance of higher borrowing costs in June, and less than even odds of a hike in the next nine months.

Among other shares active on corporate news, Pandora A/S jumped 9.9 percent after the Danish jeweler reported profit that beat projections and raised its full-year forecast. EasyJet Plc added 2.5 percent after posting a narrower pretax loss than estimated.

Luxury shares advanced after Credit Suisse raised its recommendation on the group to overweight, similar to buy, from underweight, citing cheaper valuations. LVMH and Christian Dior SE climbed more than 2.9 percent.

Natixis SA tumbled 9.4 percent after the French lender said quarterly profit dropped by almost a third. ThyssenKrupp AG lost 4.7 percent after a steel glut brought on by Chinese exports led the company to cut its profit forecast.

Source: Bloomberg

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