* STOXX 600 up 0.4 pct at close
* Zodiac plummets on another profit warning
* Swedish fashion retailer H&M down on sales miss
* Hikma jumps following results
(Recasts, adds quote and detail, updates prices at close)
By Helen Reid and Kit Rees
LONDON, March 15 European shares achieved their
highest closing level in two weeks on Wednesday, boosted by
basic resource and oil stocks, while French aeroplane seat-maker
Zodiac slumped after its latest profit warning.
The pan-European STOXX 600 index was up 0.4 percent
at its close, with the market focused on potentially divisive
elections in the Netherlands and a U.S. Federal Reserve policy
meeting that could signal how much monetary tightening to expect
during the remainder of the year.
A recovery in oil prices after a surprise U.S. crude
stockpile drawdown eased worries about a supply glut and spurred
a rally in basic resources stocks with the sector up 1.7
percent, followed by major European oil-related stocks
which rose 1.2 percent.
Outokumpu and Glencore were among the
top gainers, with their shares up 7.3 percent and 2.9 percent
respectively. Outokumpu's shares jumped after the European
benchmark price for ferrochrome, a crucial raw material for
steel production, was set lower than expected. .
Bank stocks also lent support, gaining 0.9 percent
ahead of an expected U.S. interest rate hike. Higher interest
rates benefit banks' margins, which have struggled in Europe's
low rate environment.
"It’s almost certain we will see an increase in interest
rates from the Federal Reserve tomorrow. The question now is not
if they will increase, but by how much," Jordan Hiscott, chief
trader at ayondo markets, said in a note.
"Going forward, with (a) possible three rate increases for
2017 alone, I predict we will see trepidation for the equity
markets in general.”
British drugmaker Hikma was the biggest STOXX
gainer, jumping 8 percent after it posted a 2.4 percent rise in
full-year operating profit on growth in its injectables and
branded business, which offset weakness in its generic drugs.
Zodiac was the biggest European faller, after it
warned on profit after the close on Tuesday. The company, which
engine maker Safran is seeking to acquire, said it sees
full-year operating income falling 10 percent against a previous
forecast of a 10-20 percent rise.
Swedish fashion retailer H&M was also among the
biggest fallers, with its shares down more than 5 percent after
it posted its first monthly sales drop in four years.
The Europe-wide retail sector index was the
worst-performing, down 0.3 percent, with Zara owner Inditex's
shares roughly flat after releasing full-year earnings.
German utility E.ON < EONGn.DE> fell 3.5 percent after it
posted a record 16 billion euro ($17 billion) loss due to
impairments on its former power plant unit Uniper
which it spun off last year.
(Reporting by Helen Reid and Kit Rees; Editing by Toby Davis)