European shares ended higher yesterday, helped by stellar sales at retailer Tesco, hopes of price rises for steel makers, and a rally in oil stocks as crude oil prices rose anew.
Credit Suisse was another climber after the Financial Times Deutschland reported French insurer Axa was interested in buying the Swiss bank's Winterthur business, which analysts have valued at up to €5 billion. Shares in Axa, which declined to comment, closed 0.7 per cent higher.
But British bank Barclays bucked the firmer market trend to shed 2.8 per cent as the prospect of further sharp cost increases and an unexceptional trading update took the wind out of its recent stock climb.
The FTSEurofirst 300 index of pan-European blue chips ended 0.7 per cent higher at 1,030.2 points, only one per cent below last Monday's 28-month peak of 1,040.55 points.
The narrower DJ Euro STOXX 50 gained 0.95 per cent to 2,904.16 points, with generally light trading volumes as US markets were shut for the Thanksgiving holiday.
Basic resources issues were also among the region's top gainers, with steel makers cheered by news that Japan's Nissan Motor had to stop production at some of its domestic car plants due to a steel shortage. Thyssen Krupp, Arcelor and Corus rose between 1.9 and 5.6 per cent.
"Nissan's announcement is a sign there is a shortage of steel in the market... and that sort of situation gives more negotiating power to producers and gives them more control over prices," said Paula Albarran, analyst at Portuguese broker Espirito Santo in Madrid.
Mining stocks also gained, with BHP Billiton and Anglo American up about two per cent each as Morgan Stanley raised its price target on a number of stocks in the sector.
Investors seemed to shrug off the euro's rise to yet another record high at $1.3247 against the dollar, even though some economists warned a strong single currency may smother Europe's frail economic recovery.
"The renewed strength of the euro is probably the most immediate risk to the euro area economy, weakening exports even further," said economist David Owen at Dresdner Kleinwort Wasserstein, adding domestic demand remained too weak to offset this trend.