Oil prices send energy stocks on roller-coaster ride
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.
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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%.
"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)