European shares open stronger on oil gains, China optimism

August 31, 2020: European shares opened higher on Monday as heavyweight oil and gas players were supported by higher crude prices, while positive service sector data from China also brewed optimism over an economic recovery.

The pan-European STOXX 600 index rose 0.4% in early trade, adding to mild gains from the prior week amid some optimism over COVID-19 treatments. A British market holiday seemed likely to keep trading volumes subdued for the day.

The European oil and gas sector rose more than 1%, leading gains across its peers as hopes of more global stimulus measures and a recovery in Chinese demand propped up crude prices.

Activity in China's services sector expanded at a much faster pace in August, official data showed, as demand across the economy continues to recover from a coronavirus-induced slump.

Among individual movers, Suez topped the STOXX 600 after larger peer Veolia offered to buy a 29.9% stake in the French water and waste firm from gas and power utility Engie for 2.9 billion euros.

Reuters