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European shares up on weaker oil price

* FTSEurofirst 300 index up 0.4 percent at 1,191.06

FRANKFURT: European shares rose on Friday as a weaker oil price boosted leisure and consumer stocks, while commodity shares fell in concert with easing raw material prices.

By 1050 GMT, the pan-European FTSEurofirst 300 index was up 0.5 percent at 1,191.06 points, adding to a 0.5-percent gain from the previous session and on track to finish the week some 0.7 percent lower.

The oil price dropped by $2 to $113 a barrel, trading near the lowest since early May, pressured by faltering global demand and rising supply, boosting consumer, travel and leisure shares.

The European travel and leisure index and the DJ Stoxx European retail index as well as the DJ Stoxx European Personal and Household Goods sector index jumped more than 1 percent each. Airlines such as Ryanair rose 4.6 percent, Air France gained 2.3 percent and Deutsche Lufthansa by 0.8 percent. Oil majors such as Total rose 0.8 percent and Royal Dutch Shell gained 0.6 percent.

Among retail stocks Swedish fashion giant Hennes & Mauritz rose 2.4 percent after posting better-than-expected July sales figures, defying an economic slowdown as cost-conscious shoppers appeared to favour its moderately priced clothes.

Defensive pharmaceutical stocks also gained, with Sanofi-Aventis up 2.3 percent after Warren Buffett’s Berkshire Hathaway investment group raised its stake.

Shares in Stada surged 10.6 percent after a media report, citing unidentified sources, said that Teva Pharmaceutical Industries was in talks to buy Germany’s third-largest generics drugmaker. Roche rose 0.8 percent and Elan added 7.2 percent.

Banks rose with Swiss bank UBS rising 2.2 percent, Royal Bank of Scotland up 1.1 percent and BNP Paribas up one percent.

Around Europe, the UK’s FTSE 100 index rose 0.2 percent, Germany’s DAX index added 0.2 percent and France’s CAC 40 gained 0.9 percent. Among major gainers, Denmark’s Vestas rose 5.5 percent after the world’s No.1 wind turbine maker said its order backlog ballooned. reuters

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