European Stocks Close On Upbeat Note For 2nd Straight Day

European stocks closed on a strong note on Tuesday, extending gains from the previous session, as worries about the impact of the Omicron variant of the coronavirus eased, and data showed a surprisingly strong German industrial output growth in October.

Markets also reacted positively to news about People's Bank of China releasing about 1.2 trillion yuan ($188 billion) of liquidity into the financial system via a cut in the reserve requirement ratio for most banks.

Firm commodity prices contributed as well to the strong upmove in the markets.

Investors largely shrugged off concerns about the likelihood of a faster pace of tapering by the U.S. Federal Reserve.

The pan European Stoxx 600 climbed 2.45%. The U.K.'s FTSE 100 gained 1.49%, while Germany's DAX and France's CAC 40 surged up 2.82% and 2.91%, respectively. Switzerland's SMI advanced 1.12%.

Among other markets in Europe, Austria, Belgium, Czech Republic, Denmark, Finland, Greece, Iceland, Ireland, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden and Turkey, all ended with strong gains, with the benchmark indexes of several markets rising between 2.5 to 4%.

In the UK market, Anglo American Plc surged up 6.5%. Ferguson, BHP Group, Aveva Group, Rio Tinto, Evraz and Antofagasta gained 4.3 to 6%.

Ashtead Group gained about 4% after lifting its expectations for the full year. Scottish Mortgage, Flutter Entertainment, 3i Group, Sage Group, Informa, Halma, JD Sports Fashion, Glencore and RightMove advanced 3 to 4%.

Crimson Tide shares ended notably higher. The provider of the mpro5 solution announced that it has entered into a Master Services Agreement with food service company Compass Group for its non-U.K. based operations.

In Paris, Kering, STMicroElectronics, ArcelorMittal, LVMH, Technip, LOreal, Essilor, Hermes International, Dassault Systemes, Teleperformance, Schneider Electric, Capgemini, Saint Gobail and Airbus gained 3 to 6%.

WorldLine shares gained about 2.6% as Eurobank, one of Greece's four largest lenders, agreed to sell 80% of its merchant acquiring business to the French payments firm.

In the German market, Volkswagen and Porsche Automobil gained 8.7% and 8.5%, respectively. Infineon Technologies, Zalando, Deutsche Post, HelloFresh, Siemens Healthineers, Adidas, Puma, Sartorius, Brenntag and Linde gained 3 to 6.3%.

SAP, Deutsche Bank, Bayer, Merck, Siemens, Daimler and Allianz also ended sharply higher. Symrise shares moved up after the supplier of fragrances, flavors, food, nutrition and cosmetic ingredients said it has signed a purchase agreement for the acquisition of Giraffe Foods Inc. Based in Mississauga, Ontario, Canada.

In economic news, Germany industrial production recovered at a faster than expected pace in October, data released by Destatis revealed on Tuesday.

Industrial production grew 2.8% on a monthly basis in October, reversing a 0.5% fall in September. Production was forecast to grow 0.8%. Year-on-year, industrial production dropped 0.6%, bigger than September's 0.4% decline.

Survey results from the ZEW - Leibniz Centre for European Economic Research showed Germany's economic confidence weakened in December as supply bottlenecks continue to weigh on production and retail sales. The ZEW Indicator of Economic Sentiment fell 1.8 points to 29.9 in December. Nonetheless, the score remained above the expected level of 25.1.

The euro area economy expanded as initially estimated in the third quarter largely driven by household spending, estimates released by Eurostat showed. Gross domestic product grew at a steady pace of 2.2% in the third quarter. The estimate for the second quarter was revised up from 2.1% and the third quarter rate was confirmed by Eurostat.

On a yearly basis, GDP advanced 3.9% instead of 3.7% expansion estimated previously.

UK house prices rose for fifth straight month and the average home price hit a fresh record high in November, reflecting the resilience of the housing market, survey results from the Lloyds Bank subsidiary Halifax and IHS Markit showed.

The house price index rose 8.2% year-on-year, same as in October, which was the highest rate since June. Compared to the previous month, house prices rose 1% in November, same as in October. Economists had forecast a 0.8% increase.

Data from the State Secretariat for Economic Affairs showed Switzerland's jobless rate decreased November, falling a seasonally adjusted 2.5% in the month, from 2.7% in October. On an unadjusted basis, the unemployment rate was 2.5% in November, same as in the previous month.

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