European shares rise on firm pharmas; Actelion soars

By Atul Prakash

LONDON (BestGrowthStock) – European equities bounced back on Wednesday, with a surge in Actelion (ATLN.VX: ) on reports of bid interest from Amgen (AMGN.O: ) boosting pharmaceuticals, while miners rose after supply worries pushed up metals prices.

The FTSEurofirst 300 (.FTEU3: ) index of top European shares closed 0.5 percent higher at 1,092.46 points, rebounding after suffering a 2.3 percent drop on Tuesday — the index’s biggest one-day retreat in nearly five months.

Actelion jumped more than 9 percent on reports the world’s largest biotech firm Amgen was studying a takeover offer for the Swiss drugmaker, which said it was in “regular dialogue” with other industry players.

GlaxoSmithKline (GSK.L: ) rose 2.4 percent following backing from a U.S. advisory panel for its lupus drug Benlysta, seen as a potential blockbuster, while Roche (ROG.VX: ) and Sanofi-Aventis (SASY.PA: ) rose 1.3 percent and 1.7 percent respectively.

Investors kept a close eye on the situation in Ireland, which agreed to work with a European Union-IMF mission on urgent steps to shore up its shattered banking sector, a process that could lead to a bailout despite Dublin’s deep reluctance.

“The picture remains that the euro zone is under severe tensions and that the underlying causes for the tensions will not be overcome any time soon. The equity markets remain vulnerable to temporary increases in this kind of tension,” said Tammo Greetfeld, equity strategist at UniCredit.

“If Ireland gets the financial aid, then in the short term this should lead to some relief for the equity market. However, any form of financial assistance is not a solution as such to the underlying causes of the tensions in the euro zone.”

MINERS ADVANCE

Miners featured among the top gainers, with the STOXX 600 European basic resources sector index (.SXPP: ) rising 0.8 percent after slumping 5 percent on Tuesday, as copper rose 0.8 percent on supply concerns following a strike at the world’s third-largest copper mine in Chile. Nickel prices were up 4.5 percent.

BHP Billiton (BLT.L: ), Anglo American (AAL.L: ), Antofagasta (ANTO.L: ) and Rio Tinto (RIO.L: ) rose 0.3 to 0.8 percent.

The Euro STOXX 50 (.STOXX50E: ) rose 0.8 percent to 2,802.70 points. Technically the index is likely to face stiff resistance at 2,805.95, the index’s 61.8 percent Fibonacci retracement of a fall from an April high to a May low.

Alexandre Le Drogoff, technical analyst at Aurel BGC, said the euro zone’s blue chip index could soon fall again.

“The index seems to be heading toward a test of the lower band of its upward channel. Weakness signals are increasing, with yesterday’s Marubozu of Yin, and there has been a rise in volumes over the past few days, just like we saw during the corrections in January and April,” he said.

Among individual movers, British credit information group Experian Plc (EXPN.L: ) rose 6.3 percent after raising its interim dividend and saying it continued to look at ways of returning cash to shareholders after a stronger than expected first half.

Across Europe, Britain’s FTSE 100 (.FTSE: ), Germany’s DAX (.GDAXI: ), France’s CAC 40 (.FCHI: ), Portugal’s PSI 20 (.PSI20: ), Ireland’s ISEQ (.ISEQ: ), Spain’s IBEX 35 (.IBEX: ) and Italy’s MIB (.FTMIB: ) rose 0.4 to 1.5 percent. The Thomson Reuters Peripheral Eurozone Countries Index (.TRXFLDPIPU: ) was up 0.9 percent.

“With all the discussions taking place between Dublin and Brussels, the only certainty at the moment is that the uncertainty will continue to limit the upside,” said Michael Hewson, market analyst at CMC Markets.

(Additional reporting by Blaise Robinson in Paris; Editing by Greg Mahlich)

European shares rise on firm pharmas; Actelion soars