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Market update

Andrew

In Europe, stock markets ended the session firmly higher on Tuesday. Early losses were erased on the Stoxx 600 which rose just under 1%, making it the third consecutive gain this week. Germanys DAX 30 index and Frances CAC 40 index both gained 1%.

Volkswagen Chief Executive Matthias Mueller, said in an interview with a German newspaper that the company would launch a recall for cars affected by its diesel emissions crisis in January and complete the fix by the end of next year.

The FTSE 100 index closed higher yesterday and with this gain, the London benchmark has now closed in positive territory for five sessions in a row, the longest winning streak since July. The top gainers were major oil companies that rallied on the back of the 5% jump in oil prices. The sharp advance came after OPEC’s Secretary-General said oil prices are set to rebound as steep cuts in global oil investments crimp supplies.

Shares of Tullow Oil PLC gained 6.9%, Royal Dutch Shell PLC advanced 3.6% and BP PLC closed 2.7% higher.

Mining firms were also gainers, tracking the increase in metals. Shares of Anglo American PLC climbed 4.3%, Fresnillo PLC put on 3.1%, and Randgold Resources Ltd. added 2.2%. Glencore PLC continued its recent pattern of volatility as shares of swung between gains and losses on ending 2.5% higher.

Still in the spotlight is the takeover of SABMiller by Anheuser- Busch in Bev. The brewer had turned down an informal takeover bid from rival AB InBev because the offer was too low. However SABMiller rose 2.8 percent after AB InBev, the world’s biggest brewer, increased its bid for its largest rival to 42.15 pounds per share in cash, valuing SABMiller at nearly 68 billion pounds.

In the U.S. markets, the S&P broke a five-day winning streak closing marginally lower during Tuesday’s trading session. This was led by a sell-off in Biotech companies and health-care stocks. The increase in oil prices and commodity prices helped pare these losses due to gains in the energy and materials sectors.

When it comes to single stock names, Shares of DuPont ripped higher after it announced that the Chair and CEO Ellen Kullman will retire effective Oct 16 after more than 27 years on the job. The rally in the stock occurred despite the trim in their earnings outlook due to the unfavourable currency impact on full year earnings.

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