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European Shares Inch Higher On Bank Merger Talk


European stocks were broadly higher on Monday, as media reports suggesting that Deutsche Bank has begun tentative merger talks with rival Commerzbank helped investors shrug off global growth worries.

Traders also reacted positively to comments from Fed Chair Jerome Powell that interest rates are currently "appropriate" and "roughly neutral.

The pan European Stoxx 600 was up 0.2 percent at 371.21 in opening deals after losing 0.9 percent on Friday.

The German DAX was also up 0.2 percent and France's CAC 40 index was marginally higher while the U.K.'s FTSE 100 was up nearly 1 percent, driven by a weakening pound amid Brexit-related uncertainty.

After Prime Minister Theresa May failed to secure significant concessions from the European Union in the latest round of talks, and with just two cabinet ministers backing her, she is facing increasing pressure to resign, the Telegraph reported.

It is believed that Tuesday's vote on her Brexit deal could result in an even worse humiliation.

Deutsche Bank jumped 1.7 percent amid reports that its top executives have agreed to hold discussions with rival Commerzbank AG about a potential merger. Commerzbank shares rallied nearly 4 percent.

Aerospace group Safran fell 1.5 percent in Paris after a Boeing 737 MAX plane operated by Ethiopian Airlines crashed.

Miners Anglo American, Antofagasta and Glencore were up 1-2 percent while energy giant BP Plc advanced 0.8 percent.

Clarkson slumped 8 percent in London after its fiscal 2018 pretax profit declined to 42.9 million pounds from 45.4 million pounds in the previous year.

Charter Court Financial and OneSavings Bank both jumped around 10 percent after the two U.K .challenger banks said they are in advanced discussions regarding a possible all-share combination of the two companies.

Provident Financial climbed 2.2 percent. The company reiterated that
Non-Standard Finance's nil-premium offer is strategically and financially flawed and presents significant risk in terms of both execution and shareholder value.

In economic releases, Germany's industrial production unexpectedly decreased in January while exports were unchanged, underpinned mainly by demand from outside the European Union, preliminary data showed.

Industrial production decreased 0.8 percent month-on-month in January, while economists had predicted a 0.5 percent gain.

A 9.2 percent slump in the automobile industry influenced the January outcome, the Economy Ministry said.

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