EUROPE MARKETS: European Oil, Mining Shares Bounce Up, Outpacing Broader Market

Euro trades above $1.09

European commodity shares popped higher Monday, with brighter prospects for the resources sector pushing prices for oil and metals higher, but the gains weren't enough to keep most European equity benchmarks from tilting lower.

The Stoxx Europe 600 index was down less than 1 point at 395.46 after rising a modest 0.2% in early trade. Oil and gas, basic materials and financial shares moved up, but health care, consumer-related and industrials shares were in the red.

Commodities cruise up: The Stoxx Europe 600 Oil & Gas Index climbed 1% Monday, bolstered by gains of more than 2% for Brent and U.S. crude futures . WTI futures were trading around $49 a barrel.

The contracts climbed after Saudi Arabian and Russian energy ministers said they back a nine-month extension to production cuts (http://www.marketwatch.com/story/crude-oil-jumps-to-2-week-high-as-saudis-russia-back-continued-output-cuts-2017-05-15) led by the Organization of the Petroleum Exporting Countries.

Meanwhile, China's President Xi Jinping over the weekend (http://www.marketwatch.com/story/xi-casts-china-as-guardian-of-globalization-as-he-pledges-100-billion-to-one-belt-one-road-2017-05-15)said there will be more than $100 billion in fresh financing to support its "One Belt, One Road" infrastructure program. Metals prices were pushed higher, including a 0.6% rise in copper futures , and as shares of mining stocks rose the Stoxx Europe 600 Basic Resources Index bulked up 1.1%.

"When oil rises and China opens its cheque book, this helps to lift risk sentiment and act as a soothing balm even though geopolitical risks are rising after frequent cyber attacks all over the world and North Korea tested its most advanced missile over the weekend," wrote Kathleen Brooks, research director at City Index.

In the oil group, producers Tullow Oil PLC (TLW.LN) and Statoil ASA (STL.OS) were up 2.8% and 1.4%, respectively. OMV AG leapt 7% after Barclays raised its rating on the integrated oil and gas company.

Among miners, Antofagasta PLC (ANTO.LN) claimed a 2.1% rise and BHP Billiton PLC (BLT.LN) (BHP.AU) (BHP.AU) tacked on 1.8%. Steel pipes maker Tenaris (TEN.MI) moved up 2.1%.

Other movers: TUI AG dropped 5% after the travel services company posted a slightly wider, first-half adjusted loss of $251.9 million euros ($273.9 million).

Indexes: The gains for oil and metals shares slightly lifted the U.K.'s FTSE 100 , up 0.1% at 7,443.72 and on track for a new record closing high.

Germany's DAX 30 index was down 5 points at 12,764.07 after hitting a record close on Friday. France's CAC 40 was off 0.1% at 5,399.69.

The euro was trading at $1.0945, slightly higher than $1.0932 late Friday in New York.

Read:The ECB has 3 big reasons to wind up QE--here's why it shouldn't (http://www.marketwatch.com/story/the-ecb-should-avoid-the-temptation-to-cancel-qe-2017-05-10) (http://www.marketwatch.com/story/the-ecb-should-avoid-the-temptation-to-cancel-qe-2017-05-10)

(END) Dow Jones Newswires

May 15, 2017 05:25 ET (09:25 GMT)