Europe close: Stocks rebound despite geopolitical uncertainty

(Sharecast News) - Stock markets across Europe put in a decent performance on Monday as investors shrugged off geopolitical uncertainty in Israel and weak economic data to hunt for bargains in the wake of a recent sell-off.

"We've seen a positive start to the week for markets in Europe despite Israel taking early steps to push into Gaza," said Michael Hewson, chief market analyst at CMC Markets UK.

"The limited and incremental nature of the incursions thus far appears to be helping assuage concerns that the escalations might prompt another front opening on Israel's northern border with Lebanon and Hezbollah."

The Stoxx 600 was up 0.36% to 431.12, with gains of 0.2% to 14,716.54 while Spain's Ibex 35 added 1.07% to 9,013.90.

The Stoxx 600 had lost 4.6% over the preceding two weeks, falling in seven out of the ten trading sessions, finishing at a low of 429.58 on the previous Friday, its lowest level since early January.

Conflict in Israel escalated over the weekend after government forces made a large-scale ground assault on Gaza, drawing condemnation from neighbouring countries.

However, reports of military action being more cautious than initially predicted may have tempered the market's reaction to the news on Monday.

Oil prices fell 3% to $87.44 per barrel on the ICE.

In European economic data, business and consumer sentiment about the economy fell slightly in the Eurozone this month, according to statistics released by the European Commission. The closely watched Economic Sentiment Indicator (ESI) fell by 0.1 points to 93.3 for October, from a revised 93.4 in September. This was in line with the consensus estimate but still marked the sixth straight monthly fall in the ESI.

The German economy shrunk less-than-expected 0.1% in the third quarter, figures from the federal statistics office Destatis revealed, after a revised 0.1% expansion in the second quarter. The consensus forecast was for a contraction of 0.3%.

Siemens Energy rose as the stock attempted to rebound from record lows seen last week after it was reported that it was in discussions with the government over €15bn in guarantees to help realise certain large industrial projects. Talks continued over the weekend, according to a Reuters report.

Electrolux shares also gained after dropping to their lowest since 2012 following worse-than-expected quarterly results from the electrical consumer products manufacturer on Friday.