Total and other heavily weighted oil stocks hoisted European stock markets higher yesterday afternoon, as crude prices held onto recent gains, with New York's higher opening also helping in an otherwise subdued session.
One bleak spot, however, was Ahold, a Dutch supermarket group hobbled by €12 billion euros in debt and the fallout of an accounting scandal.
The company posted a worse-than-expected 12.4 per cent fall in second-quarter sales, sending its shares three per cent lower.
Volumes were thinner than usual, exaggerating share moves on a number of stocks, as summer holidays took many investors away from their computer screens.
Sentiment remained mixed as investors took comfort in a string of quarterly earnings that were largely in line or slightly above expectations, but worried that a softer-than-expected economic recovery may push back a long-awaited pick-up in corporate revenue growth to 2004, rather than the second half of 2003 as many had hoped.
By 1400 GMT, the FTSE Eurotop 300 index of pan-European blue chips was up 1.2 per cent at 872 points, while the narrower DJ Euro Stoxx 50 gained 1.5 per cent to 2,472 points.
Gainers outpaced declining issues by a ratio of more than four to one.
"Without being euphoric, sentiment is much more bullish than a month ago but markets are affected by uncertainties on the strength of the dollar, on when interest rates will start going up and on soaring oil prices," said CIC chartist Pierre Vignaud in Paris.
Around Europe, London's FTSE 1OO added 1.3 per cent, Frankfurt's DAX gained 0.7 per cent and the CAC 40 picked up 1.5 per cent. The Swiss blue chip index was 0.6 per cent higher.
Across the Atlantic, the blue-chip Dow Jones industrial average rose 0.4 per cent to 9,162, while the tech-laden Nasdaq Composite Index gained 0.5 per cent to 1,660.
Italy's ENI and Royal Dutch/Shell each rallied three per cent as higher crude oil prices and a stabilising dollar raised hopes of yet more profits for the oil titans.
Norway's energy group Statoil also buoyed the sector, its shares rising three per cent after it announced a surprising oil find at the Norwegian Sea Ellida field, an area where it had been exploring for gas.
"Oils seem to be catching up after being relatively left behind by recent market gains, even though they all posted very strong sets of results," said a sector analyst in Paris.
"Total may have a little plus, linked to their decision to continue buying their shares back when the others have stopped doing so, but I think the main factor for the rise is sectoral rather than down to individual stocks."
Shares in troubled French heavy engineering firm Alstom seesawed back into positive territory after an early slide, still dogged by uncertainty despite the announcement of a state-backed rescue package.
In a separate twist, Alstom had to issue a statement yesterday afternoon rejecting claims by Royal Caribbean Cruises (RCCL) that faulty equipment from the French firm had led it to cancel cruises, saying the claims were "without basis or substance".