European shares climb on bank gains, focus turns to earnings season

European shares rose on Monday, led by banking ​stocks as oil prices eased on hopes of ​Russia-Ukraine energy ceasefire, while investors awaited the ‌start ​of the earnings season for fresh catalysts. The pan-European STOXX 600 index gained 0.56% to 635.09 points by 0843 GMT.

Spain's bank-heavy IBEX jumped 1.1%, the most among regional peers, ‌while the STOXX 600 banking sector advanced 1.5%. Oil prices slipped on expectations of more Russian supplies after US President Donald Trump said Ukraine and Russia had agreed to halt attacks on each other's energy facilities following a US-Russian diesel-supply deal.

Investors now will ‌be eyeing earnings reports from corporate Europe to gauge the health of companies amid geopolitical uncertainty and higher borrowing ‌costs. David Morrison, senior market analyst at Trade Nation, said third-quarter earnings, especially from semiconductor companies and other AI beneficiaries, would be key in shaping near-term market sentiment.

LVMH will report results after markets close in Europe. Its shares were marginally higher and the broader sector also edged higher. Semiconductor equipment maker ⁠ASML ​and investment firm EQT are due ⁠to report later this week.

Eurozone bond yields eased on Monday, further helping lift sentiment for riskier assets. However, yields remain near multi-year highs, reflecting concerns ⁠that interest rates will stay higher for longer.

Traders currently expect the European Central Bank to keep rates on hold at its ​October meeting, while pricing in a quarter-point rate hike in December, according to LSEG-compiled data. Still, analysts point to limited ⁠scope for further ECB tightening given the euro zone's weak growth backdrop.

"The euro area cannot point to robust economic growth. That's simply not the ⁠case," ​Morrison added. Automobiles shares added 0.8%, on track to extend gains from Friday after China agreed to cut exports of its hybrid and plug-in hybrid vehicles to the EU.

Media stocks were the biggest laggards, down 0.6%. Among other stock ⁠moves, Nordex advanced 2.5% after the onshore wind turbine manufacturer said its project order intake in the third quarter rose ⁠30% year-on-year.

Vallourec rose 4% ⁠after the French steel tube maker won a contract from TotalEnergies < TTEF.PA> for the Absheron gas field in Azerbaijan. Inwit advanced 3.4% after Reuters reported exclusively that the telecoms towers company's ‌leading shareholders were arranging ‌the financing for a potential take-private deal.