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* Bank subindex best performer in the region
* Italian shares at highest since May 2018 on Unicredit
* STOXX 600 set for best week since Dec 2016
* Energy stocks fall as oil prices decline, Total bucks on Q4 beat (Updates to close)
Feb 6 (Reuters) - Euro zone banks led European shares to new highs on Thursday amid a broader rally in global stocks prompted by China’s move to halve additional tariffs on some U.S. goods.
The pan-European STOXX 600 index extended gains to a fourth session and closed up 0.4% at 425.49 - an all-time high - but retreated slightly from 426.70 hit earlier in the session as a decline in oil prices weighed on energy majors.
Beijing said it would lower extra levies imposed last year on 1,717 U.S. products, weeks after the signing of a Phase 1 trade deal that brought a truce to a bruising trade war between the world’s two largest economies.
Trade-sensitive basic resources and technology sub-sectors in Europe rose about 0.7% and 0.5%, respectively.
Beijing’s decision also brewed some optimism over lessening the economic shock from a coronavirus outbreak that has killed over 500 people and caused widespread disruptions to China’s economy.
Lenders Unicredit, DNB and Nordea Bank all rallied more than 6% after reporting strong quarters. Germany’s Deutsche Bank posted its best day in more than eight years after revealing that a new shareholder, Los Angeles-based Capital Group, took a 3.1% stake in the company.
All this saw the euro zone banks index post its biggest daily gain in a month. Italy’s bank-heavy MIB jumped 1% to close its highest in nearly two years with Fiat Chrysler’s 0.8% rise adding to the rise.
Drugmaker Sanofi was the biggest boost to STOXX 600 as well as the main index in Paris after it forecast further profit growth for 2020. Oil major Total’s 1% rise on beating quarterly results also lifted French stocks.
Worries over coronavirus shaved 3% off the STOXX 600 last week, but the benchmark is now on pace to log its biggest weekly gains since December 2016.
Ingo Schachel, head of equity research at Commerzbank, highlighted a strong rebound in cyclical shares.
“It’s still a tough time for cyclicals but some of the bellwethers like ArcelorMittal have surprised markets with reasonably good numbers.”
The steelmaker soared 11% after reporting a bigger-than-expected annual profit and its lowest-ever level of debt.
Swiss shares also scaled new highs on Thursday, with telecom firm Swisscom in the lead after reporting a near 10% rise in full-year income.
But not all earnings shone as brightly. Swedish security companies Securitas and Assa Abloy slipped after reporting a slowdown in organic sales growth.
Reporting by Ambar Warrick in Bengaluru Editing by Shounak Dasgupta, Bernard Orr and Frances Kerry
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