European Stocks Close Mostly Higher Amid Economic Optimism
(RTTNews) – European stocks climbed to record highs on Wednesday, as optimism over the economic recovery and earnings growth outweighed concerns over the spread of the Delta variant in China.
In economic news, the euro area private sector grew the most in more than 15 years in July, underpinned by steep manufacturing output growth and an accelerated expansion of services activity, final data from IHS Markit showed earlier today.
The composite output index rose to 60.2 in July from 59.5 in the previous month, but the reading was below the flash score of 60.6.
Elsewhere, the recovery of the UK.’s services sector slowed in July alongside record inflationary pressures.
Separate data from Eurostat revealed that Eurozone retail sales grew at a slower pace in June largely due to a drop in food sales.
Retail sales grew 1.5 percent on a monthly basis, slower than the 4.1 percent increase in May and economists’ forecast of 1.7 percent.
On a yearly basis, retail sales growth moderated to 5 percent from 8.6 percent in the previous month. Sales were forecast to climb 4.5 percent.
The pan-European Stoxx 600 Index climbed 0.6 percent to 468.22 after rising 0.2 percent on Tuesday. The German DAX Index also advanced by 0.9 percent, while the French CAC 40 Index and the UK.’s FTSE 100 Index both rose 0.3 percent.
Hugo Boss closed modestly higher. The German fashion house returned to growth in the second quarter and said it expected a rebound in its business to continue in the second half of the year.
Thales shares also moved to the upside. The French aerospace company announced that it was in advanced talks to sell its railway signaling business to Japan’s Hitachi for around $2 billion.
Taylor Wimpey climbed 1.9 percent. The UK. homebuilder raised its full-year earnings outlook after building a record number of homes in the past six months.
Rolls-Royce Holding also rose by 1.3 percent. The engine maker has agreed to sell its Bergen Engines medium speed liquid fuel and gas engines business to global engineering group Langley Holdings plc for an enterprise value of €63 million.
On the other hand, Commerzbank tumbled by 5.8 percent after the lender swung to a second quarter loss, hit by one-off costs such as those related to its restructuring, involving hundreds of branch closures and 10,000 job cuts.
Ferrexpo also plunged by 9.3 percent. The world’s third-largest exporter of iron ore pellets sees demand for iron ore declining in the second half of the year from the record levels currently being seen.
Schaeffler edged lower despite the automotive and industrial supplier posting strong half yearly results and raising its 2021 guidance.
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