European shares get boost from Iran nuclear deal

LONDON, November 25, 2009 of Reuters)--European shares led to a five year-high, and Germany's DAX set a new record on Monday with airline stocks and French automakers getting a big boost from nuclear agreement signed between the Iran and world powers.

The deal eased geopolitical tensions and raised risk appetite in markets worldwide, as the West sanctions against the Iran in return for Tehran relaxed curbing its nuclear programme at least temporarily.

Travel and leisure stocks rose 1.6 percent, led top sectoral gainers, airlines.

Energy stocks pressure on oil prices after the deal that included hitting the easing of a ban on European insurance for shipments of Iranian oil, the smooth Iran's crude oil exports can help its major Asian customers.

"The Iran deal helps risk-sensitive stocks in the short term, but the equity risk premium is only slightly lower and shares have only a little bit higher, came," Jeremy Batstone-Carr, analyst at Charles Stanley, said.

"It's a good start, but it is too early to say what will be the long-term effects of the transaction."

IAG, the owner of British Airways and Iberia, rose by 2.4 percent, Air France-KLM advanced 1.8 percent and EasyJet gained 1.3 percent.

French automaker PSA Peugeot Citroen and Renault, which had a considerable threat to the Iranian car market of Western sanctions on Tehran have been tightened, 4.6 per cent and 1 per cent or won. Energy stocks fell but 0.6 percent.

1531 GMT was the Pan European FTSEurofirst 300 0.4 percent at 1.301,72 points, while Germany's DAX Rose 0.8 percent, close set a record high.

The volatility index VSTOXX, widely followed barometer for investor nerves about the market touched its lowest level since 2007.

The eurozone blue chip-Euro STOXX 50 index rose 0.4 percent to 3.068,48 points, with technical analysts positive on the index-Outlook.

"The measured tendency of the Euro STOXX 50 index remains optimistic and positive with the climb of the 200-day moving average," said Murray Gunn, Director of technical analysis at the HSBC Bank.

He saw that the support the index at their recent the 3.016 low and a movement among 2.999, said a deeply on 8 November the first sign would be that the trend changed.

Among top individual moving German dialysis provider Fresenius Medical care rose by 7.5 per cent, the top gainer on the FTSEurofirst 300, according to a US Healthcare Agency, said it would not cut reimbursement rates for kidney dialysis 2014 as was proposed in July.