European Shares Get Energy Boost From Potential Oil Supply Cuts

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(Bloomberg) — European equities advanced on Thursday as the energy sector climbed on a report that China is moving forward with plans to buy up oil for its emergency reserves.

The Stoxx 600 Index was up 0.4% at 8:14 a.m. in London, with real estate shares also rising. France’s Credit Agricole SA is the latest bank to cancel planned dividends.

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European stocks are coming off their worst quarterly slump since 2002 on worries about the fallout from the virus outbreak that has spurred sweeping restrictions across the region. While the Stoxx 600 has bounced off its mid-March low amid unprecedented stimulus measures and signs of the infection stabilizing in Italy, investors and strategists are split on whether the market has bottomed.

China is taking advantage of a 60% plunge this year to acquire cheaper barrels for its stockpiles, according to people with knowledge of the matter. On the coronavirus front, global cases topped 937,000, while Italy and Germany moved to extend lockdown measures and Florida ordered people to stay home.

“Right now it’s very complicated to predict where the market is going as we are seeing sharp moves with no real fundamental reasons,” said Alfonso Benito, chief investment officer at Spanish asset manager Dunas Capital. “Next most relevant event everyone is waiting for is the upcoming earnings season to have a feeling of how deep” the impact of the coronavirus will be, he added.

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