EUROPE MARKETS: European Stocks Boosted By Greek Bailout Deal, Gains For Oil

By Carla Mozee, MarketWatch

Energy shares gain as oil heads for $50

European stocks bounced higher Wednesday, as Greece's creditors reached a deal to unlock more bailout funds for the debt-burdened country, and as oil prices approached the $50-a-barrel level.

The Stoxx Europe 600 gained 0.6% to 356.24. All sectors moved higher, led by the oil and gas group. The pan-European index was on track for a second consecutive gain, after Tuesday's session closed 2.2% higher (http://www.marketwatch.com/story/european-stocks-turn-higher-led-by-gains-for-banks-2016-05-24).

Greek deal: Greece will receive 10.3 billion euros ($11.48 billion) in new loans (http://www.marketwatch.com/story/breakthrough-greek-debt-deal-reached-with-eurozone-imf-2016-05-24), if a deal struck in the early hours of Wednesday morning is signed off by the 19 member countries in the eurozone.

The new payout comes after eurozone finance ministers and the International Monetary Fund agreed that Greece has made the necessary progress on financial reforms. The funding will help Athens from defaulting on large debt redemptions to the IMF and European Central Bank in July. The ministers also agreed on a road map on debt relief for Greece.

"Greece's creditors reached a deal to avoid a summer car crash in a way that only they know how, involving extension of maturities, adjustment of interest rate payments with a good dose of things still to be decided, some of them after the German federal elections next year," said Simon Smith, chief economist at FxPro, in a note.

"Still, for the single currency, this has removed one of the potential risks for the summer, with the deal unusually being reached comfortably ahead of the loan disbursement next month," he said.

The euro was up 0.1% to $1.1156.

Investors will look for the Ifo business-sentiment survey at 9 a.m. London time, or 4 a.m. Eastern Time.

Oil: Energy shares were supported as oil prices crept toward $50 a barrel (http://www.marketwatch.com/story/crude-oil-rockets-to-near-50-a-barrel-as-data-hints-at-us-supply-drop-2016-05-25) , with the move coming after industry data pointed to decreases in U.S. crude inventories. Official stockpile data will be released by the Energy Information Administration later Wednesday.

Among energy producers, Spain's Repsol SA (REPYY) rose 2.4%, and Italy's Eni SpA (ENI.MI) gained 1.6%. Oilfield services firm SBM Offshore NV (SBMO.AE) picked up 0.8%.

Indexes: Germany's DAX 30 was up 0.8% to 10,141.76, while France's CAC 40 moved up 0.4% to 4,450.72. The U.K's FTSE 100 added 0.6% to 6,258.66.

Italy's FTSE MIB picked up 0.6% to 18,011.22, and Spain's IBEX 35 advanced 0.9% to 8,995.

Movers: Marks & Spencer Group PLC (MKS.LN) shares dropped 7% as the apparel and food retailer said profit fell 19% and warned on margins (http://www.marketwatch.com/story/marks-spencer-profit-down-19-warns-on-margins-2016-05-25).

(END) Dow Jones Newswires

May 25, 2016 03:59 ET (07:59 GMT)

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