Oil prices send energy stocks on roller-coaster ride
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European stocks climbed out of the red and finished at a 21-month high Friday, as buying appetite for assets perceived as risky returned ahead of the French presidential election.
The Stoxx Europe 600 index turned higher during the session, ending up 0.7% at 394.54, its highest since August 2015.
The pan-European benchmark logged a 1.9% weekly advance, boosted by well-received earnings reports and hopes that centrist Emmanuel Macron will beat far-right Marine Le Pen in Sunday's runoff race in France.
See: When are the election results due on Sunday? (http://www.marketwatch.com/story/french-election-when-are-the-results-on-sunday-2017-05-05)
France's CAC 40 index finished up 1.1% at 5,432.40, sticking to its highest level since January 2008. The index closed the week up 3%, extending last week's rise of 4.1%.
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"We believe that the most immediate effect of a Macron win on Sunday would be to ameliorate concerns about the rise of populism in Europe for at least the next few months, likely providing a boost to global financial market sentiment," said Peter Donisanu, analyst at Wells Fargo, in a preview of Sunday's runoff race.
"Nevertheless, European market participants have largely priced in a Macron victory, potentially setting the stage for a short-term 'buy the rumor, sell the news' pullback in European risk assets," he said.
Read:Brace for market mayhem if Le Pen unexpectedly wins French presidency (http://www.marketwatch.com/story/brace-for-market-mayhem-if-le-pen-unexpectedly-wins-french-presidency-2017-05-04)
The euro hit $1.1000 late Friday, a level it hasn't traded above since early November, according to FactSet data.
Also, the iShares MSCI France ETF (http://www.marketwatch.com/story/france-etf-hits-highest-level-since-2014-with-macron-victory-seen-likely-2017-05-05)(EWQ) traded at its highest since July 2014 on Friday. In the fixed-income market, the yield on France's 10-year bond rose 1 basis point to 0.77%.
Germany's DAX 30 index closed at a record high, finishing up 0.6% at 12,716.89. The U.K.'s FTSE 100 index moved up 0.7% to close at 7,297.43. (http://www.marketwatch.com/story/oils-comeback-helps-lift-ftse-100-ahead-of-us-jobs-report-2017-05-05)
Read:European equities a buy, but watch for this Trump risk: Eaton Vance (http://www.marketwatch.com/story/european-equities-a-buy-but-trump-policy-inaction-a-risk-eaton-vance-2017-05-03)
Oil U-turns: After settling at the lowest level in five months on Thursday, oil prices staged a turnaround Friday, with West Texas Intermediate crude up nearly 2%. But for week, the contract was set for a 6% slide.
Read:OPEC faces high-stakes decision as oil drops to 5-month low (http://www.marketwatch.com/story/opec-faces-high-stakes-decision-as-oil-drops-to-5-month-low-2017-05-04)
Shares of oil companies swung higher as crude prices turned positive. BP PLC (BP.LN) (BP.LN) ended up 1.5%, Total SA (TOT) (TOT) rose 2%, and Eni SpA (ENI.MI) added 2.5%.
Other stock movers: Shares of International Consolidated Airlines Group SA (IAG.LN)(IAG.LN) jumped 5.5% after the British Airways and Iberia parent said operating profit got a boost from lower fuel prices in the first quarter (http://www.marketwatch.com/story/iag-profit-edges-higher-on-lower-fuel-costs-2017-05-05).
Also in the airline industry, budget carrier easyJet PLC (EZJ.LN) gained 4.2% after reporting a 12% rise in passenger traffic for April.
See:European airlines take off after upbeat IAG, easyJet numbers (http://www.marketwatch.com/story/no-pr-disasters-here-european-airlines-take-off-after-upbeat-iag-easyjet-numbers-2017-05-05)
Pearson PLC (PSON.LN) (PSON.LN) surged 12.4% after the publishing company reported a rise in quarterly sales (http://www.marketwatch.com/story/pearson-sales-up-6-holds-to-guidance-2017-05-05) and confirmed its full-year outlook.
Vestas Wind Systems AS (VWS.KO) climbed 5.1%. The Danish wind-turbine manufacturer beat earnings forecasts (http://www.marketwatch.com/story/vestas-beats-forecasts-on-strong-us-china-sales-2017-05-05) after a quarter of strong sales in the U.S., Germany and China.
Struggling Italian lender Banca Monte dei Paschi di Siena SpA (BMPS.MI) said late Thursday it swung to a loss in the first quarter (http://www.marketwatch.com/story/monte-dei-paschi-swings-to-quarterly-loss-2017-05-05), hurt by declining revenue and one-time costs. Its shares are still halted after the company had to ask the Italian government for a bailout in December.
Economic news: The widely watched U.S. jobs report showed a bigger-than-expected 211,000 new hires in April (http://www.marketwatch.com/story/us-creates-211000-jobs-in-april-as-hiring-rebounds-2017-03-10), keeping alive expectations the Federal Reserve will raise interest rates again in June.
(END) Dow Jones Newswires
May 05, 2017 12:22 ET (16:22 GMT)