European Markets Shake off Espirito Santo Worries, as Tobacco Lifts London

European markets recovered some of the ground they lost on Thursday, as Portugal’s Espirito Santo Bank tried to reassure over the strength of its capital base. The bank was at the eye of the storm on Thursday after one of its Espirito Santo Group stable-mates delayed debt repayments. But while it share remains suspended, the bank said it had more than enough capital to cover its $1.6 billion exposure to the problem unit. In London Imperial Tobacco said it was considering buying some cigarette brands from Reynolds American and Lorillard, hinting the brands could become available if the two U.S. rivals complete a merger. In Germany, defense company Rheinmetall is trying to break up a planned merger of rival Krauss-Maffei Wegmann and French government defense contractor Nexter.