European shares rise on Wall Street bounce; focus on data-packed week

By Shubham Batra and Khushi Singh

(Reuters) -European shares climbed on Monday, buoyed by the momentum on Wall Street that propelled the to close above 5,000 for the first time, while investors assessed earnings and economic data for insights into the European Central Bank’s rate outlook.

The pan-European rose 0.3% and hovered around its two-year highs, with all the sectors trading in the green.

Italian stocks outperformed regional peers with a 0.6% increase, hitting their highest level since June, 2008.

Rate-sensitive real estate shares led the gains among sectors, rising 1.2% and on track to log their best day in nearly three weeks.

“Policymakers continue to say that they are encouraged by the progress made on inflation, but they are still sounding a note of caution and that’s why I think you’ve seen some revision of market expectations of interest rate cuts,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

“However, there’s still quite a few rate cuts priced in and that’s partly what’s driving the enthusiasm.”

This week is packed with economic data, including euro zone’s fourth-quarter GDP growth, consumer price inflation from Spain and other regions, and ZEW survey to gauge industry expectations on the state of the region’s economy.

Across the Atlantic, investors will closely monitor the U.S. January CPI print on Tuesday for clues on the potential timing of a rate cut by the Federal Reserve.

Among individual movers, shares of Tod’s surged 17.2% after private equity firm L Catterton said it would launch a tender offer to buy 36% of the luxury shoemaker at 43 euros per share.

Novo Nordisk (NYSE:) rose 1.1% following a report that its controlling shareholder, Novo Holdings, plans to invest up to $7 billion annually by 2030.

Saras dropped 5.4% as global commodity trader Vitol

agreed to buy 35% of the oil refiner from Italy’s Moratti family at 1.75 euros per share, valuing the entire group 1.7 billion euros.

Just Eat Takeaway and Delivery Hero were the top performers on the STOXX 600, up 6.0% and 5.0%, respectively, after Deutsche Bank raised the target price on the stocks.

Siemens Energy advanced over 4% after an upgrade by BofA Global Research.

Meanwhile, comments from ECB’s chief economist, Philip Lane, and Bank of Spain Governor Pablo Hernández de Cos will also be on investors’ radar at 0945 GMT.