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European Stock Advances on Addition from Banks and Commodities; UK’s FTSE 100 rises 1.1%

European Stock Advances on Addition from Banks and Commodities; UK’s FTSE 100 rises 1.1%

By Devik Jain and Susan Mathew

July 7 (Reuters) – European stocks extended their gains on Thursday as oil and metals prices lifted commodity prices, while banks lifted Italy’s main index by 3.1%, the biggest daily increase since mid the month of March.

* The pan-European STOXX 600 index gained 1.9% on broad gains. Miners climbed 5.4% as copper rose from 20-month lows on hopes of improving demand in China. The energy sector rose by 4%.

* Banks advanced 3.4%, the biggest gain from the STOXX 600. Italy’s MIB index, heavily weighted by banks, rose further from November 2020 lows hit this week.

* Trading remained volatile as investors questioned whether market valuations have become attractive after a sharp sell-off on fears central banks could trigger a recession with aggressive interest rate hikes to control inflation.

* “The key question is whether inflation will come down first or do we need a recession to reduce inflation later,” said Dhaval Joshi, chief strategist at BCA Research.

* London’s FTSE 100 rose 1.1% despite the resignation of British Prime Minister Boris Johnson, as analysts said the move was expected as several ministers in his government have resigned in recent days after a series of scandals.

* Chipmakers STMicroelectronics, BE Semiconductors, ASM International and ASML Holding rose 2.9% to 4.6% after Samsung Electronics Co Ltd posted its best April-June profit since 2018.

* Shares in Danish food ingredients maker CHR Hansen fell 9.8% after it posted disappointing quarterly results and lowered its organic revenue growth target for 2021/22.

(Edited in Spanish by Carlos Serrano)

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