LONDON (Thomson Financial) - Europe's largest exchanges moved higher in opening deals, recovering some of the ground lost on Friday as investors hope their U.S. peers will be in buying mood after their extended Independence Day break although renewed selling in banking stocks capped gains.
At 8:48 a.m., the DJ STOXX 50 was up 9.76 points, or 0.34 percent, at 2847.34 and the DJ STOXX 600 was up 1.74 points, or 0.62 percent, at 281.27.
In Asia, the Nikkei closed up 122.15 points, or 0.9 pct, at 13,360.04 as investors chased bargains among recently battered property and banking stocks.
The Hang Seng ended the morning up 321.38 points or 1.5 percent, at 21,745.20.
Oil prices eased in Asian trading on Monday after Iran offered over the weekend to negotiate on its nuclear drive.
New York's main oil futures contract, light sweet crude for August delivery, fell $1.52 to $143.77 a barrel from Thursday's close of $145.29.
Back in Europe, Iberdrola posted one of the sharpest rises after Repsol, Gas Natural's second-biggest shareholder, said it would like to see a merger between the two utilities.
In an interview with Barcelona newspaper La Vanguardia, Repsol's Antonio Brufau said a merger between the two still makes sense after he twice failed to buy Iberdrola when chairman of Gas Natural in 2000 and 2003. Iberdrola shares added 4.29 percent.
Arcelor Mittal shares added 2.56 percent as Cazenove lifted its price target for the group to 81.1 euros from 66.6 euros. Smaller German steel group Kloeckner added 2.5 percent as the broker lifted its target to 47.9 euros from 45.2.
Airbus parent EADS, up 1.66 percent gained as it said it is close to a deal with British aerospace group GKN whereby GKN, up 1.4 percent, will take control of an Airbus wings factory at Filton in Britain, sources briefed on the matter said on Friday.
Late Friday, EADS also said it has opened exclusive negotiations with French aerospace, defence, nuclear and automobile group Daher on the sale of a majority stake in EADS' Socata unit.
Tomtom climbed 2.64 percent after sharp recent falls as the Dutch maker of personal navigation devices (PNDs) sought to reassure the market that second quarter sales remain healthy.
DSM, up 1.29 percent, as the group's reassuring comments on the current business environment offset news the Dutch chemicals group is to take a 25-30 million euro hit from an interruption in production at its DSM Agro plant.
But Heineken shares slumped 3.64 percent amid reports the group is set to restate profits for newly-acquired brewer Scottish & Newcastle by as much as 10 percent after finding discrepancies in the Edinburgh-based company's accounts.
Heineken's top executives have been meeting City analysts to warn them to expect a restatement of S&N UK's accounts when it reports half-year results at the end of August.
'Heineken was already being conservative on the UK so this is no surprise to us,' said one analyst at a leading Benelux brokerage, describing today's share price move as 'an overreaction'.
That said, he pointed out the UK is an important market and this is just another reason to avoid the stock short term.
Early resilience in the banking sector soon gave way to further selling as negative newsflow continues apace.
Bradford & Bingley Plc. fell 1.25 percent after it said late Friday it will issue approximately 828 million new shares in its enlarged rights issue, representing approximately 57 percent of its enlarged share capital, with 67 new shares offered for every 50 existing shares.
Meanwhile, shares in fellow UK mortgage banking group Alliance & Leicester fell 1.76 percent after reports it is planning to slash its dividend to shore up its finances in a move expected to save the mortgage bank about 80 million pounds a year.
CS Group fell 0.18 and UBS fell back 2.49 percent after reports Swiss authorities could require the pair to set aside an additional 70 billion Swiss francs ($68.29 billion) in capital.
'40 billion for UBS, 30 billion francs for CS,' parliamentarian Hans Kaufmann told Swiss weekly Sonntag, referring to the additional capital the banks would have to put aside under the proposal. deborah.hyde@thomson.com dlh/rfw COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.
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