You are here

Europe: Shares end higher helped by strong earning updates

Friday, February 26, 2016 - 06:42

1.jpg

[MILAN] European shares rebounded on Thursday from losses earlier in the week, as solid corporate results including from British bank Lloyds lifted stock markets.

The pan-European FTSEurofirst 300 index, which had fallen around 4 per cent in the previous two sessions, ended up 2 per cent at 1,284.58 points.

The FTSEurofirst remains around 10 per cent weaker since the start of 2016, dragged down by concerns about a slowing global economy and the health of Europe's banking sector.

Markets were looking ahead to this weekend's G-20 meeting of world financial leaders in Shanghai but some investors were sceptical it could provide a big boost to sentiment. "We're getting closer to the G-20 meeting but the market doesn't look to be expecting much out of it," said Alessandro Balsotti, Senior Portfolio Manager at JCI Capital in London.

sentifi.com

Market voices on:

Lloyds surged 13.5 per cent after announcing a special dividend payment and higher profits, while shares in the rig company Seadrill advanced 6.7 per cent as investors welcomed a refinancing plan.

AXA also progressed 1.2 per cent after posting higher profits, and gains in top banking and insurance stocks added the most points to European stock markets.

Phone group Deutsche Telekom rose 2.1 per cent after better than expected fourth-quarter results in its domestic German market, helped by expansion of its super-fast broadband network.

German builder Hochtief rose 11.7 per cent after its full-year operational net profit grew more than expected, as its European division for the first time in many years achieved a clear break-even result. "Today it was one of the busiest days for corporate earnings in Europe and the market has been strongly rewarding companies that have beaten consensus," said Stephane Ekolo, Chief European Strategist at Market Securities.

Zodiac Aerospace slumped 25 per cent after announcing a profit warning.

According to Thomson Reuters StarMine data, 53 per cent of companies on the European STOXX 600 index have met or beaten market expectations with their fourth quarter results.

US investment bank Citigroup cut its 2016 global economic growth forecast but kept an "overweight" position on European shares excluding the UK.

"We remain 'overweight' Europe excluding the UK, where equities look especially attractive relative to bonds, and'underweight' UK where Brexit fears are likely to be a drag, "Citigroup wrote in a note, referring Britain's vote in June on whether to stay in the European Union.

REUTERS

Nespresso
Pair your daily business read with the perfect cup of espresso.

Subscribe to The Business Times today to receive your very own Nespresso Inissia coffee machine worth $188.

Find out more at btsub.sg/btdeal

Powered by GET.comGetCom