European Stocks Gain as Oil Prices Rally

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Oil barrel with arrow isolated on white background

European stocks extended its rally on Wednesday as investors were encouraged by the recovery in oil prices and await the imminent release of the American central bank’s minutes for its January meeting.

The pan-European STOXX 600 gained 1.6%, with all sectors trading higher.

In London, the FTSE 100 inched up 1.6%, while Germany’s DAX rose 1.7%. France’s CAC climbed 2%, as a surge in Credit Agricole shares propelled the index higher.

Meanwhile, the MSCI Asia Pacific Index slid, with Japan’s Topix shedding 1.1%. The Nikkei 225 likewise dropped, losing 1.3%.

Fortunately, China’s Shanghai Composite and Shenzhen Composite countered the losses for the region, to close in positive territory.

Meanwhile, oil continued to influence market sentiment, pushing prices up, as investors digested the impact of the freeze agreement reached in Doha on Tuesday.

On Wednesday, Iran’s OPEC representative told a local publication that it was ‘illogical’ to ask Iran to freeze its oil production level given the current level of its output.

“Asking Iran to freeze its oil production level is illogical,” said Mehdi Asali, Iran’s OPEC envoy, in a report by the Shargh daily newspaper.

“When Iran was under sanctions, some countries raised their output and they caused the drop in oil prices,” Asali added.

The statement was made after Russia, Saudi Arabia, Venezuela and Qatar agreed to freeze oil output at January levels.

Tehran has previously indicated that it wants to bring production back to its pre-sanction levels.

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