European shares rose in early trade on Wednesday as French lender Credit Agricole led banking stocks higher and earnings provided a boost.
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The pan-European STOXX 600 index was up 0.3 percent in early trade with the European banking index the top-gaining sector, up 1.2 percent.
Shares in Credit Agricole jumped 3.2 percent after France’s biggest retail bank beat forecasts with a smaller than expected earnings drop in the fourth quarter.
Banking stocks were also helped by hawkish rhetoric from U.S. Federal Reserve Chair Janet Yellen on Tuesday, who said that the Federal Reserve will likely need to raise interest rates at an upcoming meeting. Low interest rates put pressure on banks’ margins, as has been the case in Europe.
Earnings also fuelled the move higher, with Finnish packaging maker Huhtamaki rising 7 percent after reporting results, the top gainer on the STOXX 600 index, and brewer Heineken also rallying 3.6 percent after confirming its margin target.
Among the biggest fallers, insurer Ageas, medical equipment firm Gerresheimer and paints and coatings company Akzo Nobel were all weaker after reporting results.
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(Reporting by Kit Rees; Editing by Toby Chopra)
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