European Stocks End Week Higher on UK, Syngenta


European Stocks End Week Higher on UK, Syngenta

European equity indexes rebounded led by UK shares after election results indicated a victory bolstered by UK shares after election results indicated an unexpected victory for Prime Minister David Cameron’s Conservatives Party.

Also aiding the rebound was a 20% surge by Syngenta after the agrochemical behemoth rejected a takeover deal by Monsanto Co. Syngenta shot up by more than CHF 64.20 to CHF396.60 to spur Swiss stocks to a rally after rejecting the unsolicited takeover offer.

The Swiss Market Index gained 2.49% to 9033 points to record a modest weekly gain of 0.2%.

The benchmark Stoxx Europe 600 climbed 2.9% to 400.16 to end near its intra-session high of 400.18.The Pan European benchmark advanced more than 1.4% for the week.

In the UK, the FTSE 100 rallied 2.3% to 7,046.82 points after Thursday’s election showed a victory for the Conservatives.  Leading the rally of the UK benchmark were utilities and financials with British bank Lloyds and utilities Centrica leading gains in the aftermath of the election.

Lloyds advanced more than 5.9% on the disappearance of the proposal by the Labour Party to introduce banking levy on their ascendancy to power. Centrica on the other hand jumped 6.8% after avoiding a potential tariff freeze under a Labour government.

“As far as markets are concerned, it is good news,” Stanhope Capital’s chief investment officer Jonathan Bell told Reuters.

“A Conservative victory is preferable over a Labour-SNP coalition and that’s why we see sterling and UK equities higher and the sectors that were under threat from a Labour policy, such as financials and utility (shares), are going to do well.”

The Sterling strengthened against the dollar to $1.54 after having hit an overnight high of $1.55. Analysts however warned that long term risks still remained with the Bank of England remaining dovish on monetary tightening.

“Longer-term risk factors remain,” Morgan Stanley analysts told Market Watch.

“The prospect of fiscal tightening and a continued dovish [Bank of England] could take some steam out of sterling gains.”

To contact the reporter of the story: Jonathan Millet at