Economy

Commerzbank Shares Top German DAX After Report Links Lender to Italian Takeover

Commerzbank Shares Top German DAX After Report Links Lender to Italian Takeover”

European stocks rose on Thursday morning after the US Federal Reserve set the date for unwinding assets on its balance sheet amassed as part of stimulus measures during the financial crisis and signaled another rate increase this year, which investors have judged as a vote of confidence in the outlook for the US economy, the world's largest.

The pan-European STOXX 600 index rose 0.2% after finishing flat on Wednesday, led by the construction sector and banks, while travel and leisure stocks and miners were in negative territory. UniCredit wants to buy the 15% share of the German government, paving the way for one of the biggest cross-border mergers in European banking.

Commerzbank is Germany's second-biggest lender.

Reuters reported late Wednesday that UniCredit, Italy's biggest bank, had made early approaches to authorities in Germany in order to sound-out support for a merger between the two lenders once UniCredit's ongoing turnaround is complete.

UniCredit shares gained around 1.3% in the opening 30 minutes of trading in Milan, changing hands at €17.70 each and giving the bank a market value of just under €40 billion ($47.5 billion).

Merger and acquisition activity continued to drive shares with Irish building materials firm CRH rising 3%, bolstering the construction sector, after it agreed to buy U.S. cement maker Ash Grove Cement Co.

Siemens rose 1.3% after reports it is in talks to merge its rail business with that of either Alstom or Bombardier and will pick a preferred partner within days for further negotiations.

Alstom shot up 3.9% to a nine-week high.

Irish building materials firm CRH rose almost 3 percent after the company said it would buy US cement maker Ash Grove Cement Co in a $3.5 billion deal to expand business in North America.

Troubled outsourcer Capita plunged 9.5 percent after reporting a fall in first-half underlying revenue.



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