Stocks still 'best game in town' as energy prices decline

European stocks rose, as energy shares rebounded from six days of losses, and optimism grew over stimulus prospects before the European Central Bank meets later this week. The Stoxx Europe 600 Index added 0.4% to 347.07 at 11:06 a.m. in London, paring earlier gains of as much as 1%. Oil and gas stocks ended their longest losing streak in almost 18 months. The Stoxx 600 lost 0.5% Monday as factory indexes fell in China and Europe, stoking concern about slowing inflation and global growth. “Stocks are still showing they are the best game in town as energy prices sink, dragging deflation expectations,” said Daniel Weston, chief investment officer at Aimed Capital GmbH in Munich. That could prompt “further ECB action to come to support growth and an inflation target,” he wrote in an e-mail. The Stoxx 600 has rallied 12% from an October low as ECB President Mario Draghi said the lender may broaden its asset-buying program to include government bonds, while central banks in Japan and China boosted stimulus measures. The ECB’s next policy meeting is on Dec. 4. More than half the economists in a Bloomberg survey expect the central bank to buy government bonds if it expands its stimulus program. Germany’s DAX Index briefly rose to 10,038.21, above its highest close. The DAX climbed as much as 0.8% before declining 0.2%. Standard & Poor’s 500 Index futures advanced 0.2% and the MSCI Asia Pacific Index added 0.3% Tuesday. ENERGY STOCKS A gauge of oil and gas shares rose 1.9% for the best performance among 19 industry groups in the Stoxx 600. Afren Plc and Genel Energy Plc surged more than 8%. Energy stocks tumbled 10% in the six days through Monday as oil prices deepened a slump after the Organization of Petroleum Exporting Countries signaled it would take no action to ease a global glut. Mining shares also gained. BHP Billiton Ltd., which gets more than half its revenue from iron ore and petroleum, climbed 2.4%. Anglo American Plc advanced 1.6% and Rio Tinto Group added 1.2%.