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European shares rebound as Turkey stress eases

European shares rebound as Turkey stress eases
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LONDON (Reuters) – European shares bounced back on Tuesday after two days of heavy selling as investors’ anxieties over contagion from a Turkish currency crisis faded slightly, thanks to reassurances from the central bank and government.

The Turkish lira firmed after the central bank had pledged on Monday to provide liquidity in response to the meltdown which has unsettled global markets.

Investors were also comforted by news that Finance Minister Berat Albayrak would hold a conference call with investors from the United States, Europe and the Middle East on Thursday, his first since assuming the post almost two months ago.

Financials were the biggest driver with euro zone bank stocks <.SX7E> rising 0.8 percent, helping to push the pan-European STOXX 600 <.STOXX> benchmark up 0.4 percent.

Banks had been the worst hit by concerns over Turkey, taking the index to a 21-month low.

Italy’s FTSEMIB <.FTMIB> jumped 0.8 percent with banks <.FTIT8300> gaining as bond yields fell after the government said it had agreed to preserve the stability of state finances and lower public debt.

Investors’ focus once again turned to results.

Antofagasta <ANTO.L> shares fell 4.1 percent, the worst performer, after the Chilean copper producer reported first-half earnings fell due to weaker ore quality and higher costs, and said trade tensions were likely to hurt demand.

Swiss dental implant maker Straumann <STMN.S> was a top gainer after results, up 4.6 percent after it raised its full-year revenue target as organic sales growth exceeded 20 percent for the first time in 10 years.

German utility RWE <RWEG.DE> rose 2.4 percent after it said its Innogy deal was on track and reported in-line first half profits.

Broker research also drove some sharp stock moves.

Siltronic <WAFGn.DE> shares fell 4.8 percent, with traders saying Citi cut its recommendation on the stock to “neutral”.

Shares in German industrial equipment manufacturer Duerr <DUEG.DE> rose 3.6 percent with traders saying local broker M.M. Warburg upgraded the stock to “buy” from “hold”.

A boost to “overweight” from Barclays sent Saipem <SPMI.MI> shares up 2.6 percent.

(Reporting by Helen Reid; editing by David Stamp)

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