Deutsche Bank shares recover to two-week high

European shares advanced in early trading on Tuesday, with British testing company Intertek Group leading the market higher after a broker update while Deutsche Bank further recovered after recent steep losses.

The pan-European Stoxx 600 index was up 0.6 per cent in early trading, while Germany’s DAX, which resumed trading after a holiday on Monday, was up 0.5 per cent.

Britain’s FTSE 100 rose 1 per cent to 7,056.77 points – its highest level since the middle of 2015 and the first time it had breached the 7,000 point level since that period.

Two-week high

Deutsche Bank rose about 2 per cent to a two-week high. Its shares had slumped to a record low on Friday before bouncing back on expectations of a swift deal with US authorities over a multibillion dollar penalty.

HSBC said that despite Deutsche Bank's obvious operational shortcomings, fears over the bank's solvency were overdone. However, HSBC cut its target price for the bank, forecasting challenging conditions for the banking environment and adding that Deutsche Bank might lose revenue due to the short-term lack of confidence.

Shares in Intertek rose more than 4 per cent, the top gainer in the Stoxx 600 index, after Jefferies raised its stance on the stock to “buy” from “underperform” and lifted its target price to 4,300 pence from 3,000 pence.

– (Reuters)