European Shares Rise Amid Market Optimism

European shares gained on Monday, driven by retail and basic resources stocks. Investors are focused on U.S. Federal Reserve Chair Jerome Powell's upcoming speech at Jackson Hole. The STOXX 600 index closed 0.6% higher, achieving a three-week high. Defence stocks fell due to budget constraints on German military aid to Ukraine.

European shares saw a boost on Monday, primarily driven by retail and basic resources stocks. Investors are anticipating a data-heavy week, placing significant emphasis on U.S. Federal Reserve Chair Jerome Powell's forthcoming speech at Jackson Hole.

The pan-European STOXX 600 index wrapped up 0.6% higher, reaching its highest level in over three weeks. Broad-based market gains contributed to its rise, bringing it above the 500-point mark after a recent dip below this threshold on August 2.

Major regional bourses in Germany, France, Italy, and Spain rose between 0.5% and 1.4%. Mining stocks surged by 2% due to strong metal prices, while Zalando and JD Sports outperformed among retail stocks. However, defence stocks took a hit following reports that the German finance ministry would not approve new military aid for Ukraine due to budget limitations.

(With inputs from agencies.)