FRANKFURT: European stocks logged a modest gain Thursday as energy shares got a brief boost from Brent crude futures, which extended their gains to touch the $50-a-barrel level.
Meanwhile, Spanish banks put the pan-European index under pressure as Banco Popular Español SA plunged.
The Stoxx Europe 600 index SXXP, +0.10% gained 0.1% to 348.91. However, the stock benchmark lost some momentum after oil-and-gas SXEP, -0.32% and basic materials shares slumped into the close, with the oil-and-gas sector gauge finishing 0.3% lower. Earlier stocks had benefited from a rise in crude but relinquished those gains as crude futures retreated.
Still, the Stoxx Europe 600 managed to close at its best level in 5 weeks after a three straight days of gains, FactSet data show.
Capping gains Thursday was Banco Popular Español POP, -26.49% which saw its shares tumble 26%. The move came as the Spanish lender said it is planning a 2.5 billion euros ($2.8 billion) share sale, an effort to ease investor concerns about its capital ratio and souring property loans.
Also in Madrid trade, shares of Banco de Sabadell SA SAB, -5.00% dropped 5%, CaixaBank SA CABK, -4.31% lost 4.3%, and Bankia SA BKIA, -2.41% moved down 2.4%. Banco Santander SAN, -1.85% gave up 1.9%.
Tumbling bank shares pushed Spain’s IBEX 35 IBEX, -0.50% 0.5% lower to 9,079.20.
On a brighter news, Spanish growth in gross domestic product was confirmed at 0.8% in the first quarter, and 3.4% year-over-year.
Oil boost: Energy stocks moved up alongside oil prices, as Brent crude LCON6, -0.71% traded above $50 a barrel for the first time since November. That rise came after U.S. data showed a larger-than-estimated decline in weekly oil stockpiles. West Texas Intermediate futures CLN6, -0.67% surpassed $50 a barrel but turned slightly negative later as investors fretted about producers ramping up output.
The retreat in crude capped pushed oil producers lower. Tullow Oil PLC TLW, -2.02% finished down 2%, after trading up by that much during the session. France’s Total SA FP, -0.09% gave up 0.1%. Oil-field services firm Technip SA TEC, -0.16% closed 0.2% lower and Subsea 7 SA SUBC, -5.23% tumbled 5.2%.
“Whether the bullish trend [for oil] still has legs or if an imminent correction is due remains a wild guess, as speculators over-exaggerate on the upside as they did recently on the downside,” said Hussein Sayed, FXTM’s chief market strategist, in a note.
“However, the Organization of the Petroleum Exporting Countries’s meeting on June 2 remains as the key risk factor in the short term as markets are eager to know whether an agreement on a potential oil freeze will see the light,” said Sayed.
Indexes: Germany’s DAX 30 DAX, +0.66% picked up 0.7% at 10,272.71, and France’s CAC 40 PX1, +0.69% rose 0.7% to 4,512.64.
Italy’s FTSE MIB FTSEMIB, +0.09% rose 0.1% to 18,216.92, while the U.K’s FTSE 100 UKX, +0.04% barely finished in positive territory, up less than 0.1% at 6,265.65.
“[D]espite a corrective move on the dollar and further gains on the oil price, there has been slight tempering of the risk appetite that has driven some strong moves on equities in recent days,” said Richard Perry, market analyst at Hantec Markets, in a note.
Movers: Daily Mail & General Trust PLC shares DMGT, -10.81% plunged nearly 11% after the publisher cut its operating-margin target for its DMG Media unit.
