Monday 11 August 2014

Europe shares bounce back as fears of Ukraine escalation ease

European shares rose in early trade on Monday, bouncing back from a sharp two-week slide and tracking a rally on Wall Street, after investors deemed Moscow was not about to send troops into Ukraine - a move which would intensify sanctions. 

Late on Friday, Russia's Defence Ministry said it had ended military exercises in southern Russia which the United States had criticised as a "provocative" step, sparking a sharp rally on Wall Street. 

Germany's DAX outperformed on Monday, up 1.4 per cent, with Daimler up 2.2 per cent and Adidas up 1.2 per cent. German companies are seen as the most vulnerable to tensions between the West and Russia because of the strong economic links between the two nations. 

The situation on the ground remains uncertain, though, meaning any relief rally could be fragile. 


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