A run higher for energy shares and miners, as well as strong updates from retailers Burberry and B&M helped drive European shares higher on Wednesday, though renewed pain for publisher Pearson weighed on the media sector.
The pan-European STOXX 600 index was up 0.5 per cent, as were the blue chips.
Luxury goods group
“(This is) the strongest performance for at least three years in terms of ... same store sales, and also the signs of an underlying rebound in demand in Mainland China are very, very promising,” Ken Odeluga, market analyst at City Index, said.
Peers Kering and LVMH also rose 1.2 per cent and 0.5 per cent, respectively.
At the other end of the retail spectrum, discount store operator B&M also rose 2.8 per cent after issuing a trading update, in which it said that it was on track to achieve profit targets for the full year.
Online retailer Zalando also saw strength in its shares after broker Societe Generale started its coverage of the stock with a “buy” rating, saying that it had the potential to play a much broader role in the future of fashion retailing.
With the European second quarter results season just around the corner, expectations see earnings increasing by over 9 percent from the same period in 2016, which would be a rise of over 6 percent excluding the energy sector, according to Thomson Reuters I/B/E/S estimates.
Norwegian lender DNB led the banking sector higher, up more than 4 per cent after its second-quarter earnings came in significantly above forecasts, helped by a rise in lending margins and lower losses on its portfolio.
Strength in oil and metals prices helped lift the heavyweight European energy sector and basic resources , which both gained around 1 per cent.
The cyclical auto sector was led by a 2.2 per cent rise in Valeo shares, which gained after the car parts maker said that it was eyeing a sale of a unit to Raicam.
Education publisher Pearson continued its slide from the previous day when it announced plan to sell its stake in Penguin Random House, down around 4.7 per cent as broker downgrades and cuts to estimates rolled in.
Investec, Panmure and Credit Suisse were among brokers revising down their targets for Pearson, with worries around its dividend persisting.
“We see some positives on the PRH exit, but are concerned by the new dividend guidance,” analysts at Investec said in a note.
Shares in British oil and gas services company Amec Foster Wheeler slumped more than 8 per cent after confirming that Britain's Serious Fraud Office (SFO) was investigating the firm and individuals associated with the business