World shares rise over sharp gains in energy stocks

World shares rose on Monday, led by sharp gains in energy shares. Traders seized the opportunity of crude oil prices soaring to three-year highs of almost USD 80 per barrel.
European stocks firmed after Germany’s election results have indicated potential chances of forming left-wing coalition. German shares jumped 1.1 per cent, while a pan-European equity index was up half a percent.
Gains were led by the energy sector, which rose almost 2 per cent while Wall Street was tipped for a firmer session, with S&P 500 futures up by 0.3 per cent.
Germany now faces months of negotiations to form a coalition government, with three parties in need to team up to clear the threshold of 50 per cent of Bundestag seats, and investors, in turn, await any large shift in policies in Germany and in the German stance towards European politics, particularly concerning fiscal expansion.
German 10-year government borrowing costs briefly fell in early trade before heading back up to rise to -0.217 , its highest in almost three months.
Increasing focus is on energy markets where oil futures have climbed around USD 9 per barrel over September.
Brent crude traded on Monday at USD 79.07 per barrel, while US crude oil rose 97 cents to USD 74.95.
Stock markets benefited also from an professed easing in Chinese US tensions and Chinese authorities’ decision to pump more cash into financial markets to make up for the fallout from Evergrande’s debt crisis.
Shares in European oil majors such as BP, Shell and Total rose as much as 2.5 per cent
Coming on top of this year’s 300 per cent rise in European gas prices, the price surges threaten to further inflame inflation expectations.
Goldman Sachs forecast Brent to hit USD 90 per barrel by year-end. The current global oil supply-demand deficit is larger than expected, with the recovery in global demand from the Delta variant impact.