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Oil and mining strength helps European stocks shrug off trade rhetoric

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By Reuters
Oil and mining strength helps European stocks shrug off trade rhetoric
The German share price index, DAX board, is seen at the stock exchange in Frankfurt, Germany, March 21, 2018. REUTERS/Tilman Blasshofer   -   Copyright  Tilman Blasshofer(Reuters)

LONDON (Reuters) – Robust oil and mining stocks drove European shares up on Wednesday as investors shrugged off a weaker session in Asia amid rising tensions between the United States and China.

The pan-European STOXX 600 <.STOXX> and eurozone STOXX <.STOXXE> were both up 0.2 percent by 0726 GMT, despite sharp falls in Asian stocks after U.S. President Donald Trump said the United States is taking a “tough stance” with China on trade.

Oil stocks <.SXEP> rose 1.2 percent after crude prices climbed thanks to falling U.S. crude inventories, while miners <.SXPP> climbed 1 percent.

Individual stocks posted big moves triggered by results and M&A speculation.

Dutch biotech firm Galapagos <GLPG.AS> soared 16.2 percent to the top of the STOXX after positive trial results for its filgotinib drug to treat rheumatoid arthritis.

British energy provider SSE <SSE.L> sank 8.5 percent after it warned first-half profit would halve compared with last year, calling its financial performance “disappointing and regrettable”.

Peer Centrica <CNA.L> also fell 3.1 percent.

Shares in Zara owner Inditex <ITX.MC> meanwhile rose 2 percent to the top of Spain’s IBEX <.IBEX> after the fashion retailer said it expected profit margin growth in the second half.

Salvatore Ferragamo <SFER.MI> topped Italy’s FTSEMIB <.FTMIB> with a 4.3 percent rise, after traders cited rumours about a potential M&A deal.

The family that controls the fashion group is not interested in selling its stake, a spokeswoman for the group said.

Hexpol <HPOLb.ST> shares rose 3.9 percent after the Swedish chemicals firm said it acquired U.S. rubber compounder Kirkhill Rubber.

Broker research also moved some stocks. German utility E.ON <EONGn.DE> fell 3.5 percent to the bottom of the DAX after Morgan Stanley analysts cut their target price on the stock.

(Reporting by Helen Reid, editing by Louise Heavens)